Using the superefficiency SBM model and the Malmquist index model, the utilization efficiency of water resources of 27 cities in Yangtze River Delta from 2012 to 2018 is calculated. A panel threshold model with the environmental regulation as the threshold variable is established to analyze the effect of the environmental regulation on the utilization efficiency of water resources. The results show that the overall utilization efficiency of water resources in Yangtze River Delta is satisfactory, and the overall Malmquist index is a rising trend. There is a single threshold effect of the environmental regulation on the utilization efficiency of water resources. When the environmental regulation is below the threshold 0494, the effect of the environmental regulation on the utilization efficiency of water resources is not significant, and only when the environmental regulation is above 0494, it can significantly promote the utilization efficiency of water resources.