Ethiopia is using her strategic water endowment to build alliances, dominate neighbours and subdue regional powers. This is triggering regional realignments and provoking instability as she pursues unilateral actions meant to elevate her position in The Horn of Africa (HoA). So far, her dam  projects have destabilised fragile ecosystems, caused famine and threatened the hydro-investments of downstream states. This paper argues that the use of water as a tool of soft power and foreign policy will expose the region to resource-based conflicts which will embolden the activities of  non-state actors such as the Al-Shabaab. The discussion projects that the next war in The Horn is likely to be based on water resources, hence, the need for African states to develop frameworks for sharing transboundary water resources.