It was formed from a merger of the following federal institutes:
- Federal Institute for Fishery Management in Mondsee
- Federal Institute for Land and Water Management Research in Petzenkirchen
- Federal Institute for Water Quality in Vienna
- Institute for Hydraulic Engineering and Hydrometry in Vienna
As of 01.01.1995, these were the Institute for Water Ecology, Fisheries Biology and Lake Science, the Institute for Land and Water Management Research, the Institute for Water Quality and the Institute for Hydraulic Engineering and Hydrometry. The implementation of the Agency was preceded by a 2 years restructuring process. The linking of the four federal institutes into one service under the common roof of one directorate brought especially synergies in the field of administration.
In 2003, the Ecological Station Waldviertel joined the Federal Agency for Water Management to complement the expertise of the Federal Agency in the field of aquatic ecology of ponds and fish farming.
At the end of 2010, the Institute for Water Quality was closed and those parts of the field of activity that were directly concerned with the implementation of the EU Water Framework Directive were transferred to the Water Section of the Ministry.
In addition to the high level of technical expertise of the Federal Agency, the management and all employees were constantly striving to advance as a learning organization in the field of administrative innovation in an exemplary manner. The Federal Agency for Water Management participated in the pilot project of the Federal Ministry of Finance on the so-called flexibilization clause under Section 17a of the Federal Budget Act. In this project, which ran for 12 years, the department had a global budget at its disposal, which could be used under its own responsibility based on control instruments (including cost accounting and controlling by key indicators - Balanced Score Card). Key issues were the decentralization of responsibility for resources, the return of generated funds to the department and the performance agreement on project programs. Output-oriented budgeting in connection with the efficient use of resources, entrepreneurial thinking, cost awareness and transparency, and control by means of adapted private-sector instruments were effects of this project. Since 2013, the global budget approach is a fixed part of the Federal Budget Act and applies to all federal agencies. Since then, the Federal Agency has been integrated into the global budget area of the central office.
The - currently - last step in the reorganization of the Federal Agency for Water Management took place in 2016. The Waldviertel Ecological Station was incorporated as a department into the Institute of Aquatic Ecology, Fisheries Biology and Lake Sciences. With the aim of strengthening the regions, the directorate of the Federal Office of Water Management was relocated from Vienna to Mondsee.