The water scarcity crisis in Iran, especially in Isfahan province, has become a major challenge in the environment and economy. The main objective of this study is to investigate the feasibility of forming a water market in the Lenjan region using the Contingent Valuation Method (CVM). The logit econometric model and the DBDC technique were used to extract the willingness to pay and receive of rice farmers. Data were obtained from 175 questionnaires distributed among rice farmers in the Lenjan region of Isfahan province in the summer of 2024. Results showed that the annual average willingness to pay and accept for one hour of water were 118503.15 and 124627.65 Tomans, respectively. Since willingness to pay is less than willingness to accept, a water market does not form in this region. However, given the close distance between willingness to pay and accept (90% confidence interval), a water market may form with the implementation of incentive policies. The variables affecting willingness to pay include the proposed amount, second job, household size, income from rice cultivation, environmental attitude, willingness to install a smart meter, and residence in the region. The variables affecting willingness to accept include the proposed amount, marriage, age, education, water disputes, profit from rice cultivation, and willingness to install a smart meter. To achieve the formation of a water market, it is recommended to implement training programs to change the cultivation pattern to low-water-consuming crops and provide financial incentives to low-income farmers, larger households, and those without a second job.