Navajo Lake, whose entire outflow disappears underground, is on the high Markagurit Plateau where the average annual precipitation is more than 30 inches. It nestles among the headwaters of several streams that flow into arid regions where competition for municipal, industrial, and irrigation water sup- plies is very keen. Several proposals for additional development and use of the water of Navajo Lake have led to controversies and raised questions in regard to the total water supply and its disposition, and to the effect of the proposed projects on existing water rights. This report summarizes the results of an investigation of the water supply of Navajo Lake and the present disposition of that supply.