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Bangladesh is one of the fastest growing economies in the world, primarily driven by its textile industries. A high amount of water is consumed and polluted in the production and processing of raw material to the final product in the textile industry. Therefore, water footprint assessment is important for textile products. In this study, the water footprint of cotton cultivation, transportation and textile industry was calculated by analyzing the amount of imported cotton, production and processing capacity of cotton yarn and cotton fabrics, wastewater volume, number of workers and pollution load database, for 2012–2016. For the textile industry, the annual water footprint was found to be 1.8 billion m³. This high amount of water footprint and water pollution may result in depletion of groundwater level and can lead to major health problems for the local people, respectively. Total water footprint for ready-made garment product is found to be 27.56 billion m³, whereas considering proper water treatment and water reuse facilities can reduce the grey water footprint to around 1.26 billion m³. This study shows the extent of water pollution, groundwater depletion and economic impact of groundwater extraction, and possible means to reduce water footprint in cotton cultivation and textile industries.