An emergency plan to flow water from the midlands to the drought-hit East is under consideration by the water companies Severn Trent and Anglian Water.
Thirty million litres of water per day - enough to supply 100,000 homes in the Anglian Water region - could be transferred 80 miles from Birmingham to Gainsborough.
David Essex, water strategy manager for Severn Trent, said: “Technical discussions are underway and this could happen as early as June.
“We now know we are in a position to be able to help our neighbours while having enough to keep our own customers in supply.
“This could be the first example of emergency water trading and a sign of things to come as water becomes scarcer and needs to be moved around the country.”
The Environment Agency has declared a drought in areasof the East of England meaning that water resources in the area are scarce.