The Analytic hierarchy process (AHP) is used to build up and solve participatory decision making model and improve management of selected regional hydro system in northern Serbia. Recently, serious conflicts in the case study area are evidenced among governmental bodies, local authorities in municipalities, responsible water management companies, ecologists, public bodies etc. The reason for conflicts is lack of funding, improper legislation or absence of precise water policies, low efficiency in water taxation and obstruction of societal and political representatives to participate in management. The decision-making model (hierarchy) is established with four levels and 13 decision elements. The overall goal is set at the top of hierarchy as a 'benefit for all'. Second level consists of three criteria (economic, social, and ecological) and five more decision elements are defined at the third level as primary system purposes (irrigation, drainage, used waters, industrial water supply, and other purposes). At the bottom of the hierarchy, four management strategies are posted as the decision alternatives, defined by authorized water management company. Model is established by consensus and then assessed by five key interest groups gathering in total 23 individual participants. At the final stage, the best strategy is identified by aggregating the alternatives' weights obtained in groups, assuming also that groups may have different importance in deriving the final solution. Successful structuring and solving the participative decision-making model, based on the AHP methodology, indicated promising and scientifically sound approach in improving the decision making practices on regional scales. Results of this practically performed experiment recommend this modeling and solving concept for further use, at least in situations similar to this Serbian case study example.