By 2030 South Africa (SA), a developing country, is predicted to be severely impacted by physical water scarcity. In order to avert a future water crisis, the country needs to find ways to reduce its reliance on conventional surface water schemes based on impoundments on rivers. Rainwater harvesting (RWH) is an alternative water resource. To date, the viability of domestic RWH within an urban setting has not been adequately considered in SA. The purpose of this study was thus to address this omission through the detailed modelling of a representative catchment. The Liesbeek River Catchment in Cape Town comprising some 6 200 domestic properties in 6 suburbs covering an area of around 1 300 ha - was chosen for this purpose; and a new computational tool, the Urban Rainwater/Stormwater Harvesting model (URSHM), was developed to take best advantage of the available data. The analysis showed that: RWH was only economically viable for a minority of property owners; climate change is likely to have limited impact on the performance of RWH systems; and - contrary to some claims - RWH is an unreliable means of attenuating peak stormwater flows.