This study investigates the optimization of water release from the Zayandehrud Dam to maximize the fulfillment of both agricultural and environmental water requirements. Given the severe water scarcity in the Zayandehrud watershed and the existing social and legal constraints, the optimization focused solely on improving the temporal distribution of water within existing annual allocation volumes and under hydraulic limitations. Two indices—the Agricultural Demand-Supply Adaptation Index (ADSAI) and the Environmental Demand-Supply Adaptation Index (EDSAI)—were developed to evaluate the performance of the current and optimized water release scenarios. The results indicated that under current conditions, there is a significant misalignment between water releases and both irrigation demands and environmental flow requirements. However, under the optimized release scenario, both indices showed substantial improvement. In particular, ADSAI values for the Mahyar, Nekoabad-Borkhar, Abshar, and Rudashtein irrigation canals increased from 2.3%, 23.6%, 50.3%, and 34% to 47.26%, 77.7%, 82.5%, and 79.33%, respectively, based on ten-day time intervals. The EDSAI also improved markedly, rising from 27.7% to 57.27%. These findings offer valuable insights for policymakers. In complex water systems where reallocation of resources is constrained by socio-legal factors, considerable improvements in water use efficiency and ecological sustainability can still be achieved by simply optimizing the timing of water releases, without requiring structural or allocation reforms.