Until very recently, water policy and management has not included Indigenous knowledge, despite itsrelevance to sustainability. However, the Australian government, through the National Water Commis-sion (NWC), started to recognise that effective and sustainable water management can be enhanced byintegrating scientific and traditional knowledge, by encouraging Indigenous engagement. The NationalWater Commission’s 2009 biennial assessments found that most jurisdictions in Australia did not have inplace effective Indigenous engagement in water management. In 2012 the First Peoples’ Water Engage-ment Council found this was still the case. This paper investigates what inhibits the process of knowledgesharing for water management and uses a case study from the Macleay River catchment in northern NewSouth Wales to elucidate both the salient constraints and incentives on Indigenous engagement in waterresources management. Primary data were sourced via 18 semi-structured interviews with key mem-bers of the Kempsey Shire community, researchers and relevant people working in water governance.The study found several constraints including socio-economic limitations, lack of capacity to engage,restrictions through various levels of engagement, how culturally appropriate engagement practices are,and ineffective leadership from all tiers of government. Submissions to the Standing Committee on Envi-ronment and Communications Inquiry into the National Water Commission (Abolition) Bill 2014 alsoidentified these constraints. These limitations interact and cannot be considered separately. The incen-tives to engagement included: the value of Indigenous knowledge for sustainable water management;participants’ incentives as genuine interest in water; a desire to use and value cultural insights; and,opportunities for improved educational and employment outcomes.