The methodology for assessing salinity damages is still in the development stage. This study develops an economic analysis of the effects of different levels of water quality on output and income for irrigated agriculture. First, a procedure for estimating physical crop losses due to salinity was summarized from the literature. Second, published enterprise and farm budgets were adjusted to show damages that might be expected for a specific irrigation project. A change in water quality, of the magnitude studied, did not indicate an adjusted cropping pattern in response to deteriorated water quality.