When used in conjunction with surface water for irrigation, groundwater serves two roles: to increase water supply; and to mitigate fluctuations in the supply of water. The later is the buffer role. This paper identifies and evaluates the economic benefit associated with the buffer role of ground water. Implications for the development of groundwater resources are investigated. An estimate is given of the buffer benefit to wheat growers of the fossil water aquifer underlying the Israeli Negev. It is found that, under the prevailing variability in the supply of surface water, this benefit may well exceed the groundwater benefit associated with the increase in water supply.