Water User Cooperative Society (WUCS) is an organization of water users administered using the principles of Cooperation. In the Cauvery Basin of Karnataka, 581 WUCS have been registered under Cooperative Society Act. To study the activity and the progress of WUCS, information was collected from the President / Secretary of thirty WUCS in Krishnarajasagar (K.R.S.) and Kabini command of Cauvery basin. Using cluster analysis, WUCS with similar characteristics (explanatory variables) were grouped into three clusters. First cluster of WUCS (20%) is characterized as well performing, with lowest transaction cost of forming WUCS (3 months), high cooperation and fund availability. Second cluster characterized as moderate WUCS (20%) had a transaction cost of 3 months with a total fund of Rs. 21,283. Third cluster as poor performing WUCS (60%) had highest transaction cost of 5 months with fund availability of Rs. 21,950. The head and tail reach farmers of Active-WUCS, Active with conjunctive WUCS (Active-CU WUCS) and Passive-WUCS command were interviewed personally (90 sample farmers). The return of Kharif paddy per rupee of CostB2 in Active-CU-WUCS (1.25) was higher than the Passive-WUCS (1.23) and Active-WUCS (1.18). Similarly, tail reach farmers of Active-CU-WUCS received net returns of Rs. 2,301, followed by Active-WUCS (Rs. 398), but Passive-WUCS incurred economic loss of Rs. 73. ANOVA indicated significant difference in net returns per acre per annum among three WUCS (1%), and t-test indicated significant difference between “Active-CU-WUCS and Passive-WUCS” and “Active-WUCS and Passive-WUCS.” The discriminant function analysis indicated that, the size of holding and the ratio of area irrigated by borewell to total area were the major factors in discriminating members and non-members. Logit regression function for willingness to pay water rate for assured summer irrigation as dependent variable showed, land holding of the farmer and distance of the farm from canal as significant factors. WTP additional water rates for assured irrigation was estimated using Tobit regression which indicated that land holding of the farmer, use of borewell Irrigation and distance of the farm from canal were the significant factors influencing the farmers’ willingness to pay.