In recent years, there have been growing calls to institutionalise the right to water. South Africa stands out in this regard. This paper examines the Free Basic Water (FBW) policy in South Africa against the backdrop of ideological currents and its institutional, administrative and policy environment. It investigates whether there is an inherent contradiction between rights-based and market-based policy debates, how the right to water is being realised and implemented in the country’s poorest areas and whether having the right to water makes a difference to poor people and their livelihoods. Drawing on empirical research, the paper argues the free basic water (FBW) policy of South Africa is a landmark achievement with respect to citizenship and socio-economic rights. However its implementation has been difficult. In part, many of its highly laudable aims can be negated either due to the lack of financing or institutional capacity, the lack of awareness of rights and accountability mechanisms to provide them and due to parallel trends towards cost recovery. Thus, in order for the right to water to be real there is the need for adequate resource commitments (both financial and institutional) and a stronger commitment to address livelihood and poverty reduction goals.