Tanks are a common feature of the south Indian cultural landscape, irrigating about one third of the total rice area in the states of Andhra Pradesh, Karnataka, and Tamil Nadu. The concentration of tanks is high in these states because of topographical features such as undulating terrain, hard rock geology, red soils (alfisols), and the bi-modal rainfall distribution. (In Tamil Nadu, there are about 39,000 tanks accounting for about 32% of the irrigated area.) This paper examines reasons for the poor performance of tank irrigation in recent years, and reports on a simulation study developed in Tamil Nadu to examine potential modernization strategies. This paper examines the results of financial criteria used to evaluate these strategies, but also summarizes findings when production and equity criteria were applied. (Author abstract).