Identification of a sustainable water source is a priority issue in case of urban water supply scheme. On 2010, Department of Public Health Engineering (DPHE) has taken up a project that includes safe drinking water supply through pipe network along with other urban utilities for 148 Paurashavas of Bangladesh. This paper presents the application of mathematical modeling for suitable water source identification. Mathbaria Paurashava of Pirojpur has been taken for case study. Water demand for the Paurashava area has been assessed up to the year 2040. Mathematical models are developed to assess the potential of surface water source and groundwater source against the present and projected water demand. For surface water model, the South West Regional Model (SWRM) is used, developed by Institute of Water Modelling (IWM). The flow simulation is carried out by Mike 11 software. The developed groundwater model of the study area comprises of 34 Upazilas. Modeling has been performed by an integrated Mike 11-Mike SHE software platform. The modeling results along with water quality data from primary and secondary sources reflect that, none of the surface water and groundwater is sufficient. Therefore, provision of an impounding reservoir has been proposed.