Groundwater resources provide a myriad of economic benefits to businesses, consumers and society at large, from supporting agricultural holdings in the cultivation of crops to ensure food security to the provision of clean water to households and tourists alike. Nonetheless, there are significant lacunae in the valuation of groundwater as an economic resource, particularly from a policy perspective, given the significant market failures that are typically associated with such common pool resources. This paper seeks to develop a tractable approach for the valuation of groundwater resources in Malta, a small island EU member state. Malta provides a compelling context for the undertaking of such an analysis. As a small island located in the middle of the Mediterranean with a semi-arid climate and a fast-growing population, Malta’s natural water supplies are sufficiently under stress, even if used sustainably, with the onset of climate change further exacerbating these issues further. The focus of this research is on the private use of groundwater in the cultivation of crops within the agricultural sector, given that it constitutes the principal private abstractor of groundwater in Malta (beyond government for public water supply). This study proposes a paradigm for the identification, characterization and—where possible—quantification of social demand for groundwater based on its use within crop cultivation. Such paradigm follows the social demand model in mainstream economics that captures both private financial benefits resulting from the sector’s use of these resources (e.g., enhanced agricultural productivity) as well as the external benefits emanating from water use (e.g., recreational value and carbon sequestration). These values are estimated using a variety of recognized approaches ranging from the residual value approach to values derived using the UN’s System of Environmental-Economic Accounting—Ecosystem Accounting which identify the economic impact of groundwater use across various sectors, including agriculture. The framework’s inherent simplicity and flexibility allows for its application across a wide variety of economic sectors, and its pragmatic approach to environmental valuation lends itself to adaptation in different countries, territories and indeed natural resources. The results underscore the significant economic contribution of groundwater resources to crop cultivation in Malta, while also highlighting the need to conduct systematic economic valuation to inform policy and thus the effective management of these resources.