Bahrain's principal environmental problems are scarcity of fresh water, desertification, and pollution from oil production. Population growth and industrial development have reduced the amount of agricultural land and lowered the water table, leaving aquifers vulnerable to saline contamination. In recent years, the government has attempted to limit extraction of groundwater (in part by expansion of seawater desalinisation facilities) and to protect vegetation from further erosion. In 1994, 100% of Bahrain's urban dwellers and 57% of the rural population had pure water. Bahrain has developed its oil resources at the expense of its agricultural lands. As a result, lands that might otherwise be productive are gradually claimed by the expansion of the desert. Pollution from oil production was accelerated by the Persian Gulf War and the resulting damage to oil-producing facilities in the Gulf area, which threatened the purity of both coastal and ground water, damaging coastlines, coral reefs, and marine vegetation through oil spills and other discharges.

Protection of the environment is a concept that exists in Bahrain, but often loses out to commercial concerns. There are relatively few areas marked as conservation sites, despite the presence of a few rare species of wildlife, but with a growing environmental awareness in Bahrain over the last few years this is likely to improve in the future. Certainly the amount of recycling that now exists is a result of initiatives taken in the last few years.

Similarly, the greater awareness and empowerment that has occurred as a result of the democratic reforms has placed environmental issues at a higher priority than previously, particularly in the case of concerns about pollution near industrial areas. This is especially true in Sitra, where local people have complained about noxious emissions from various factories and power plants.

A wildlife sanctuary established in 1980 home to threatened Gulf species, including the Arabian oryx, gazelle, zebra, giraffe, Defassa waterbuck, addax, and lesser kudu. Bahrain has also established captive breeding centers for falcons and for the rare Houbara bustard. The goitered gazelle, the greater spotted eagle, and the green sea turtle are considered endangered species.