The objective of the research is that of providing indications for a water policy for EU industrial districts (small firms local systems, largely present in the EU and fundamental in italian industrial development). High water pollution and demand (as an input) are typical of most of the sectors in which industrial districts have developed. In order to fulfill the aim of the research the chosen research object is a relevant and representative case-study: the Prato area. Prato is very representative as industrial districts, as water problems (scarcity and pollution) and as choosen water policy (that have been widely followed in other industrial districts). The proposal is in particular that of an analysis of the alternative options available for water policy in Prato, from the point of view of the two industrial districts main policy issues: the choice of water treatment and the incentives for industry to produce and adopt less polluting technical innovations. The evaluation methodology proposed is the 'multicriteria analysis'. This methodological choice is based on the conviction that the choices in water policy are strongly dependent on the specificity of the productive, territorial, social, institutional, environmental typology they are applied to. Therefore the advantage of multicriteria analysis is in its capability to treat a long and heterogeneous list of criteria relevant for the choice.