The misalignment of the boundaries of watersheds and jurisdictions is cited often as a barrier to effective water governance, but the validity of the assertion depends on watershed scale and the decisions or processes involved. The paper probes these decision processes and their alignment with scales of natural watersheds and with governance processes. Two examples from the USA provide context and data to inform the discussion, one from the humid eastern part and one from the drier western part. Ultimately, the spatial and governance scales determine the complexity of decisions. The major issue is the level and nature of negotiations and how stakeholders communicate and work with each other to resolve issues in a form of pragmatic federalism, where the concept merges into decentralization to the subwatershed level. At smaller scales, negotiations can be worked out in person-to-person venues but at larger scales institutions have their own trajectories and inertia. Ultimately, watershed boundaries can be effective for joint planning and assessment, but decisions follow governance patterns. Basin boundaries do provide venues for coordination mechanisms to mediate conflicts.