This research article published by Springer Nature Switzerland AG., 2015This article contributes to the contemporary debate on land and water grabbing through a detailed, qualitative case study of horticultural agribusinesses which have settled in Tanzania, disrupting patterns of land and water use. In this paper we analyse how capitalist settler farms and their upstream and downstream peasant neighbours along the Nduruma river, Tanzania, expand and defend their water use. The paper is based on 3 months of qualitative field work in Tanzania. We use the echelons of rights analysis framework combined with the concept of institutional bricolage to show how this contestation takes place over the full spectrum of actual abstractions, governance and discourses. We emphasise the role different (inter)national development narratives play in shaping day-to-day contestations over water shares and rule-making. Ultimately, we emphasise that water grabbing is not a one-time event, but rather an on-going struggle over different water resources. In addition, we show how a perceived beneficial development of agribusinesses switching to groundwater allows them to avoid peasant-controlled institutions, avoiding further negotiation between the different actors and improving their image among neighbouring communities. This development illustrates how complex and obscured processes of water re-allocation can be without becoming illegal per se.