The NEGOWAT project aims to elaborate, structure and test a methodology combining an agent-based modelling approach and role game playing as a discussion and mediating tool for facilitating negotiations/discussion over land and water management issues, in the specific context of the urban fringe of metropolitan upstream catchments in Latin America. The research aims thus to provide (i) a conceptual tool that will allow to analyse land and water management in this context (ii) a methodology (including computing tools) and its guidelines for its implementation to explore, test and discuss scenarios while reinforcing the participation of marginalised stakeholders of the city fringe in all stages of the processes. The research is implemented simultaneously in two countries: In Bolivia, in the catchment of Tiquipaya, part of the metropolitan region of Cochabamba (1 million of inhabitants). In Brazil, in the spring areas of the metropolitan region of São Paulo (18 millions inhabitants), more specifically in the Guarapiranga catchment and the Cabeiceras-Tietê catchment. The activities are implemented by two multidisciplinary teams that gather specialists in different thematic field areas (urbanisation, farming system research, hydrology, sociology, institutional economy, law), specialists in modelling, in action-research and intervention with stakeholders. This first annual report presents the state of advancement of the project one year after the beginning of the work.