A water wise Gunnedah Golf Club will save at least a month's supply of the precious resource every year under a new water management plan.
The stage two development will capture water run-off from the club's roof and carpark and channel it via underground irrigation pipes to one of two on-course dams.
"We expect it will save us at least a month's water use in the summer period," golf club secretary Peter Vernon said.
Previously, run-off water was diverted into the town's storm water drains and barely touched a blade of grass.
The water will now be collected in the irrigation dam located between the sixth and eighth hole.
The project is part-funded by a government grant signed off last year.
More course developments are planned in the coming years including replacement of the well-worn irrigation piping installed in the 1960s and new water-conserving turf for the tees.
"It's all about making us more efficient with our water use," Vernon said.
"We're on the right track now."
The drainage works on the 9th hole are expected to be complete by the end of the week.