Madina Al Munawara faces severe water scarcity due to its low rainfall, and high evaporation rates. The city depends heavily on energy-intensive desalinated water to meet its growing demand. This study aims to develop innovative water management solutions by reusing ablution water from the Prophet’s Mosque. It also seeks to integrate these solutions into the design of multifunctional public green spaces to enhance urban sustainability. The methodology involves a multi-phase approach that includes data collection, system design, and material selection. The system design incorporates reservoirs made from volcanic stones to optimize water storage and minimize evaporation. A graded layering system from volcanic stones was introduced to increase retention capacity. The findings demonstrate that reusing ablution water can reduce Madina Al Munawara’s dependence on desalinated water. The integration of these green spaces helps improve air quality and alleviate the urban heat island effect. Additionally, the project enhances social well-being by establishing public recreational spaces that assist community involvement and social interaction. These multifunctional green areas provide a healthier and more connected urban environment. The study presents a replicable model tailored to the needs of Madina Al Munawara, supporting both sustainable water management and urban resilience in arid environments.