Shortage of drinking water and pollution of water bodies are the growing problem in urban centers of Nepal. Kathmandu, the capital of the nation, is severely affected by these problems where water is supplied only half of the actual demand and the major rivers are turning into open drains. Similarly, ground water is depleting at about 2.5 meters every year due to over extraction. There is no sign of increase in water supply within a decade and the nation has still not developed a concrete plan to clean up its rivers. In such circumstances, local level actions must be initiated to solve this crisis where people need to be oriented on simple techniques for sustainable management of water. Some of these techniques include rainwater harvesting, wastewater recycling, and ecological sanitation system. These techniques can be implemented from a single household to community level. In last two years, these initiatives have already been adopted by a few individuals and institutitions. This paper describes a case study of a house in Kathmandu where rainwater is used for all purposes including drinking, greywater is recycled for non drinkable purposes and human excreta is utilized as a fertilizer by adopting ecological sanitation technique.