The development and application of new forms of automation and monitoring, data mining, and the use of AI data sources and knowledge management tools in the water sector has been compared to a ‘digital revolution’. The state-of-the-art literature has analysed this transformation from predominantly technical and positive perspectives, emphasising the benefits of digitalisation in the water sector. Meanwhile, there is a conspicuous lack of critical literature on this topic. To bridge this gap, the paper advances a critical overview of the state-of-the art scholarship on water digitalisation, looking at the sociopolitical and ethical concerns these technologies generate. We did this by analysing relevant AI applications at each of the three levels of the UWC: technical, operational, and sociopolitical. By drawing on the precepts of urban political ecology, we propose a hydrosocial approach to the so-called ‘digital water ‘, which aims to overcome the one-sidedness of the technocratic and/or positive approaches to this issue. Thus, the contribution of this article is a new theoretical framework which can be operationalised in order to analyse the ethical–political implications of the deployment of AI in urban water management. From the overview of opportunities and concerns presented in this paper, it emerges that a hydrosocial approach to digital water management is timely and necessary. The proposed framework envisions AI as a force in the service of the human right to water, the implementation of which needs to be (1) critical, in that it takes into consideration gender, race, class, and other sources of discrimination and orients algorithms according to key principles and values; (2) democratic and participatory, i.e., it combines a concern for efficiency with sensitivity to issues of fairness or justice; and (3) interdisciplinary, meaning that it integrates social sciences and natural sciences from the outset in all applications. © 2022 by the authors. Licensee MDPI, Basel, Switzerland.