Global groundwater assessments rank Iran among countries with the highest groundwater depletion rate using coarse spatial scales that hinder detection of regional imbalances between renewable groundwater supply and human withdrawals. Herein, we use in situ data from 12,230 piezometers, 14,856 observation wells, and groundwater extraction points to provide ground-based evidence about Iran’s widespread groundwater depletion and salinity problems. While the number of groundwater extraction points increased by 84.9% from 546,000 in 2002 to over a million in 2015, the annual groundwater withdrawal decreased by 18% (from 74.6 to 61.3 km3/y) primarily due to physical limits to fresh groundwater resources (i.e., depletion and/or salinization). On average, withdrawing 5.4 km3/y of nonrenewable water caused groundwater tables to decline 10 to 100 cm/y in different regions, averaging 49 cm/y across the country. This caused elevated annual average electrical conductivity (EC) of groundwater in vast arid/semiarid areas of central and eastern Iran (16 out of 30 subbasins), indicating “very high salinity hazard” for irrigation water. The annual average EC values were generally lower in the wetter northern and western regions, where groundwater EC improvements were detected in rare cases. Our results based on high-resolution groundwater measurements reveal alarming water security threats associated with declining fresh groundwater quantity and quality due to many years of unsustainable use. Our analysis offers insights into the environmental implications and limitations of water-intensive development plans that other water-scarce countries might adopt.