Water management practices in the Vietnamese Mekong Delta have predominantly focused on structural development (e.g. dikes) to support rice besed agricultural production. Given the existing conventional approach, however, many of these efforts have been rendered ineffective. This study adops the policy transfer concept to investigate how the participatory approach is introduced into the local institutional system, and how it shapes the construction, operation and management of the North Vam Nao scheme. Results suggest that this allow stakeholders to engage colaboratively in these processes. The study contributes an emperial understanding of how policy transfer enhance institutional capacity of water resources management in the delta.