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Urmia Lake (UL), located in northwestern Iran, is an important global biosphere; however, it has been experiencing a sharp drop in its water levels since 1995. While some measures have been taken since 2013 for the lake restoration, their impact on Land Use and Land Cover (LULC) changes in the UL basin have not been studied. In this study, we evaluated the restrictive policies effectiveness on agriculture development in the Barandoz basin, Iran. Therefore, the LULC changes of the study basin were analyzed using RS, GIS and Landsat satellite images from 1992 to 2018. The results showed an increase in rain-fed agricultural lands, garden, and built-up areas, which was about 268% (17248 ha), 160% (8934 ha), and 174% (1444 ha), respectively, during the period 1992–2018. On the other hand, rangelands, irrigated croplands, barren lands, and water bodies have decreased about 22% (19298 ha), 12% (1972 ha), 30% (5240 ha), and 99% (1117 ha), respectively. Our study also showed that gardens have increased about 40% (4174 ha), from 2013 to 2018. Analysis of the hydro-climatic parameters indicated no significant decrease in the precipitation, a significant decrease in the outflow from the basin, and a considerable increase in the groundwater depth in the Barandoz plain. We showed that the new restrictive policies adopted from 2013 have not prevented LULC changes and agricultural development in the studied basin. This study emphasizes the necessity of the integrated water resources management of basins based on an accurate understanding of the LULC changes.