This thesis analyses how and why the recurrent costs of water services are shared between different actors in the rural local government areas in Mali which are supported by the international NGO WaterAid. This analysis of the financing arrangements for rural water services is used to critically assess theory, policy and practice in three areas: the community-based management approach to service delivery, the role of decentralised local governments in supporting community management, and the ability of external organisations to influence institutional change. Empirical evidence is presented for the period 2008-2011, drawing on research fieldwork undertaken in collaboration with WaterAid and its partners in 2010 and 2011, as the organisation introduced its own Sustainability Framework to help understand and address the challenges to delivering sustainable rural water services. The thesis argues that approaches to understanding local institutions for natural resource management based on ‘critical institutionalism' (Cleaver 2012), which emphasises the importance of improvisation and adaptation across different scales, should be placed within broader political economy analysis frameworks for assessing challenges in public services delivery from national to local levels. The use of such a framework shows how WaterAid and its partners adopt a ‘critical institutionalist' perspective at community levels to support users in developing ways of raising funds for water services which draw on both traditional practices and NGO influences. However at local government and national levels their approach is based on ideas of ‘best practice' rather than ‘best fit' (Booth 2012): although the costs of local government support to communities under the model promoted by WaterAid lie within international benchmarks, it is unclear over what timescale this approach could be scaled up in Mali without donor support. This demonstrates the limited ability of local governments to ensure the delivery of decentralised public services without additional external resources and support themselves.