Water resource is very important for human beings survival and development. Water rights system, which plays an irreplaceable role in realizing the multi-values of water resource, is the key to solve the water crisis in China. But there are many problems in setting up China's modern water rights system for the time being. For one thing, the academic circle does not have a clear understanding about water rights, for another, the legislation on water rights system is awfully lagging. Therefore, it is an urgent task to define water rights and perfect the law on water rights system.