DRY conditions have forced the rural town of Bundarra onto Level 1 water restrictions.
Bundarra draws its water from Taylors Pond in the Gwydir River, restrictions are triggered when the dam levels fall below 74 per cent.
"On farms the water situation is pretty dire, people are having to destock because they don't have water," Uralla Shire Council deputy mayor Bob Crouch said.
"It depends very much on the weather, Bundarra was on Level 1 before we got some storms and the Gwydir flowed a little bit, but now we're back on them because of the dry times."
As of Sunday, residents can only use handheld hoses with trigger nozzles and sprinklers for lawns and gardens between 3pm and 10am.
On farms the water situation is pretty dire, people are having to destock because they don't have water.Bob Crouch
Just one hour away, Uralla has been moved to Level 3 water restrictions.
Lawns and gardens can still be watered from 3pm to 10am, but the use of sprinklers and fixed hoses is banned.
Residents can only wash the windows of their cars under Level 3 restrictions and the use of treated town water for stock is prohibited. For more information visit the council's website.