The Water Poverty Index (WPI), a tool designed for integrated analysis of water issues, was set-up in a community in Madhya Pradesh, India through a transparent and participatory process. Though the aim of the WPI is to primarily use existing statistical data, quantitative information from census and local records was combined with qualitative data from community interviews and participatory exercises. The inclusion of community chosen indicators and the adjustment of values so that higher numbers represent water prosperity rather than water poverty, led to the Water Prosperity Index (WPI⁺). The WPI ⁺ score was contrasted with the WPI at community level. It was also calculated for two community areas with different caste and socio-economic characteristics and weighted separately according to water issues prioritized by men and women. The WPI ⁺ revealed a great difference in water access between the two areas and in prioritized issues between men and women illustrating the importance of appropriate spatial representation and gender sensitive assessments for revealing important disparities. Results also showed that highly aggregated data hide these differences making it more difficult to target the most vulnerable groups when planning measures to increase equitable water allocation. While quantitative data reveal an important perspective of the water situation, qualitative data about adequacy of resources, services or institutions, improve understanding of which issues to prioritize. A valid and useful community water index must be based on representative participation, transparency and local influence on the methodology and subsequent results.