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Abstract Around the world, water rights systems govern the allocation of water to a multitude of users. Such systems primarily come into play during times of drought, when some users have to be shorted. Yet their management during times of excess can have implications for subsequent drought impacts. This is evident in the State of Colorado, where under “free river conditions” in which there is sufficient water to satisfy all water rights, anyone—including individuals lacking water rights—can divert as much as they want, unconstrained by the limit of their water right. Here, we estimate the amount of excess water used under such conditions within Division five of the Upper Colorado River Basin in the State of Colorado. Comparing the daily water withdrawals of diversion structures along the Colorado River and its tributaries with their (daily) water rights, we find that in 2017, 339 structures report days with excess withdrawals, amounting to 108 million cubic meters (87,577 acer feet). While such excess withdrawal is legal in Colorado, we argue that the free river condition is an antiquated rule that will make much needed reform of water allocation within the water‐stressed Colorado River Basin more difficult. We offer policy suggestions to address it.