This paper reviewed rainwater collection and water resource management in Ningnan County in southwestern mountain of China, as a case study for solving the problems of water management in a simple and sustainable way. In this mountainous agriculture system, private agricultural enterprises were introduced into local mountain agriculture to solve capital fund shortage for the construction of rainwater harvesting system. Agreement was signed by private agriculture enterprises with the target farmers to subscribe for the household agriculture production at a protection price. Cash invested by the enterprise and subsidy from the government were collected for purchasing materials, while the farmers supplied labors for the construction of water harvesting systems. The system solved the share of input and benefits between the local government, enterprise and household farms successfully. In addition, the micro water harvesting tanks and micro irrigate systems extend quickly in this mountainous county. Up to 2007, more than 12 000 rainwater harvesting tanks had been established and more than 8.5×104 hm2 dry arable land accounting for nearly 75% of the total arable land had been irrigated efficiently. Per capita income of farmer had been increased by 14 times in the past 20 years. Considerable potential for further improvement in implementation of the models for solving water shortage and water resource management in mountain region maybe depend on more local private agriculture enterprises and households than the government.