The 'virtual water' thesis is beginning to take centre stage in the water security global discourse. From its origins as a conceptual tool for countering the gloomy Malthusian ('water scarcity leads to water wars') argument, it is now increasingly seen as a serious prescriptive tool for the redistribution of water from water-rich to water-poor regions of the world. The authors interrogate the thesis from apolitical economy and sustainable livelihoods perspective, arguing that the indiscriminate use of 'virtual water' as a prescriptive tool has important implications for the security, vulnerability and livelihood strategies of actors within nation-states. Adopting such an approach could turn what is a highly illuminating analytical concept - 'virtual water' - into a deleterious policy instrument. The water may very well be characterised as 'virtual' but the people and politics are very 'real'.