Cities across the United States are moving to restrict AI data center development, as communities voice growing concerns about water supplies, electricity costs, and land use. Austin, Texas, became the latest to act on Thursday, when its City Council voted unanimously to begin drafting rules that could restrict or exclude new data centers.

The vote followed a Ceres study examining water withdrawn by power plants serving data centers in Virginia, Texas, California, Illinois, Georgia, Ohio, and Arizona—seven states that together host roughly half of the nation’s data centers. The report is among the first to size the sector’s indirect water footprint—the water used to generate its electricity—rather than only the water data centers consume on site for cooling, an approach that captures a larger share of the industry’s total draw on freshwater resources.

According to the study, those plants withdraw about 3.4 trillion gallons of freshwater annually, equal to 10.4 million acre-feet. That figure exceeds California’s average annual urban water demand of 8 million acre-feet and is roughly 12 times the combined annual water use of Los Angeles, Phoenix, and Washington, D.C.

“Overall, we saw that 66% of the power plants that use water in those states were exposed to medium to high water stress,” Kristen James, senior program director for water at Ceres, said in a statement.

The study counts water that power plants draw from rivers, reservoirs, and other sources to generate electricity for data centers. Some of that water is returned, but water consumed through evaporation or other processes is not immediately available for reuse.

In Austin, officials will now draft Land Development Code changes defining data centers and establishing safeguards. Council members are expected to consider the first phase of the ordinance in December. Because there is no comprehensive federal framework governing where data centers can be built, zoning and land-use rules like Austin’s have become the primary policy lever available to local governments seeking to shape the industry’s expansion.

The nonprofit consumer advocacy group Public Citizen said the vote stood in contrast to what it described as inadequate action from Texas state leaders.

“While Gov. Greg Abbott can only offer performative and mostly voluntary measures, local leaders are acting to protect the community from large-scale data centers,” Kaiba White, an Austin-based climate policy specialist for Public Citizen, said in a statement.

Austin follows several other American cities that have taken measures to prevent data centers used for AI computing and other technologies from being built within their borders. In June, San Marcos, Texas, barred data centers under its zoning laws, while Durham, North Carolina, and Cave City, Kentucky, imposed moratoriums. Earlier this month, Jersey City, New Jersey, banned data centers as the primary use of industrial property.

The rise in opposition has also led to arrests, with at least 37 Americans detained during AI data center protests so far in 2026.

The push has expanded beyond local ordinances to state legislatures. In April, Maine lawmakers approved what would have been the country’s first statewide moratorium on large data centers. Gov. Janet Mills later vetoed the bill because it did not exempt a proposed project in Jay, though she subsequently created an advisory council to study data center policy. Earlier this month, Pennsylvania imposed new requirements for large data centers, including annual water and energy reporting.

The pushback has also taken to the streets. In March, roughly 200 protesters marched outside the San Francisco offices of OpenAI, Anthropic, and xAI, demanding a pause in the development of more powerful AI systems.

Overall, cities in Texas, North Carolina, Kentucky, and New Jersey have pursued bans or moratoriums on data centers, and at least 75 proposed projects worth about $130 billion faced local opposition in early 2026. How Austin’s December ordinance draft is written—and whether more states follow Pennsylvania’s reporting model or Maine’s moratorium path—is likely to shape how other jurisdictions balance the sector’s economic investment against strain on local water and power systems.