From Water Wiki
Most states east of the Mississippi River are known as a riparian states, in contrast to the western states' "prior appropriation" systems for water allocation. "Riparian" means "alongside water." The essence of riparian rights as a water allocation scheme is that a person who owns land on, alongside or crossed by a natural watercourse has a legal right to access and use the water running through the property.Courts have struggled through the centuries with the extent of this legal right and the ways in which one riparian user's rights relate to other users' rights. In North Carolina, as in most other riparian states, courts generally require a riparian owner's use of water to be "reasonable." This "reasonable use" standard gives courts a lot of flexibility to resolve disputes between water users, but it does not give those users or others interested in water allocation much certainty in predicting how future disagreements will be resolved. Because riparian rights are tied to the land, they cannot be sold or transferred to other users. Further, riparian rights as a system for water allocation is designed to encourage the use of water; it is not a good system for resolving disputes when water is scarce and efficiency in water allocation among competing users takes on a greater significance. A question of great practical interest and legal import, but no simple answers, is where the line gets drawn between riparian rights and public trust rights in regard to the withdrawal of water.
Riparian rights do not mean ownership of the water itself. Since at least A.D. 500, with the Code of Justinian, for the Roman Empire, then England and the British Commonwealth, and ultimately United States common law, water in its natural watercourse has been legally held to be public property--held by the state in trust for all people--rather than private property. This is the first big challenge for those who believe water should be allocated by markets: first, there must be more or less clearly defined private property rights to water before trades of water for money are possible on a widespread basis. In other words, the state has to intervene and change current riparian rights and in effect guarantee through the courts that one person can exclude another person from the use of running water. The southeastern United States' current law follows instead in the Roman tradition, which began with the idea that water should be allowed to flow as it had always flowed:
Aqua currit et debet currerer, ut currerer solebat.
“Water runs, and ought to run, as it has used to run. “ Or, a running stream should be left to flow in its natural channel, without alteration or diversion, and by implication, that water is the common and equal property of every one through whose domain it flows. This is the ancient basis of the modern public trust doctrine.
“By natural law these things are common to all: the air, running water, the sea, and as a consequence the shores of the sea’…They are not property, or , as has been said, they are in the ‘negative community.’ This is sometimes phrased that they ‘belong to the public’ or to the ‘state in trust for the people.’ ….all systems of water law adopt the elemental idea that running water while in its natural situation is not owned; that the law regulates the use of it, but that rights of flow and use are what the law recognizes, and not property in the water itself. The water itself is ‘common’ or ‘publici juris.’” 
So while private property rights are important in understanding water allocation, it is also not historically possible (in places with the English and American common law traditions) to view water in its natural watercourse as solely a matter of private property. There is always a need to recognize the shared, public nature of water. The United States Supreme Court reiterated this in 2008, in its opinion in the original jurisdiction case of New Jersey v. Delaware:
..the right of a riparian owner to wharf out is subject to state regulation. Report 58; see 1 Farnham, supra, §63, p.284 (rights of riparian owner “are always subordinate to the public rights, and the state may regulate their exercise in the interest of the public”); Shively v. Bowlby, 152 U. S. 1, 40 (1894) (“[A] riparian proprietor . . . has the right of access to the navigable part of the stream in front of his land, and to construct a wharf or pier projecting into the stream . . . , subject to such general rules and regulations as the legislature may prescribe for the protection of the public . . . .” (internal quotation marks omitted)).
Justinian’s maxim ran into major problems as soon as it became clear that water meant power—literally, the power to turn mill wheels. Because using water meant taking it out of its natural course. Another ancient legal maxim was long used to resolve disputes about the ensuing liability,
Sic utere tuo ut alienum non laedas.
“Use your own property in such a manner as not to injure that of another.” In other words, having exercised the control over water needed to mo ve it out of its natural course and put it to some use, i.e. acting like an owner of the water, one was at least not to injure another person’s property interests. This maxim gave way in the face of the nineteenth century’s drive to industrial progress, made mainly on the strength of motive power, particularly water wheels. Professor Mort Horwitz’ justly famous book, THE TRANSFORMATION OF AMERICAN LAW, 1780-1860, documents the struggles of jurists to come to terms with the conflicts between mill owners, property owners, and other claimants on water rights. Out of these struggles emerged the frankly instrumental idea of “reasonable use” that continues today as the cloudy common-law lenses through which judges decide most eastern water disputes.
Leading cases in North Carolina on the "reasonable use" rule for water withdrawals include Bayer v. Nello Teer, Rouse v. City of Kinston, Harris v. Norfolk & Western Railway Company and Pendergrast v. Aiken.
In North Carolina, as in most other riparian states, the common law doctrine of riparian rights has been modified in various ways to bring some categories of water use under more direct administrative control. For example, in times of drought, or when water use over a large area has led to lowering of the water table, North Carolina has regulatory mechanisms for allocating the water. A further important set of limits on riparian rights comes in the form of federal laws and agreements governing the operation of water impoundments. So it is accurate to say that North Carolina's current water allocation system is regulated riparianism.
There are also nuances in water law that may affect riparianism in unpredictable ways; for example, the Winters Doctrine.