Poor water governance regimes and the imbalance caused by the increasing demand for water and diminishing supply of water has resulted in severe water scarcity. Consequently, water management authorities across the world face the challenge to ensure that quantity, quality, distribution, and allocation of water among the various uses are sustainable. Therefore, water reuse on a large scale that has been ignored in the past is gaining importance in recent years as a reliable alternative source of water. Nevertheless, successful expansion and integration of water recycling into future sustainable water management plans encounter various impediments such as costs compared to other water sources, public acceptance, minimization of environmental and health impact, and technology to treat water to an appropriate standard. Further, there is an on-going debate on increasing community and private sector involvement to address these problems. In this context, adopting a case study approach this paper discusses the critical success factors (CSFs)-social, institutional, regulatory and policy, financial, technical, and risk-for private sector involvement in wastewater management. The paper also discusses the activities supporting these set of factors, thereby leading to sustainable wastewater management.