Irrigation plays a critical role in enhancing agricultural productivity and ensuring food security, particularly in arid and semi-arid regions where rainfall is unreliable. The Erer Irrigation Scheme, one of the oldest surface irrigation schemes in the Somali Region of Ethiopia, has experienced declining performance due to structural deterioration, sedimentation, weak management, and high conveyance losses. This study evaluated the technical, operational, and institutional performance of the scheme from October 2023 to January 2024 using standardized irrigation performance indicators. Field measurements were conducted along the main and secondary canals to determine discharge, water levels, and conveyance losses. Crop water requirements were estimated using CROPWAT 8.0 based on climatic data obtained from the Jigjiga Meteorological Station. Key performance indicators assessed included water adequacy, equity, dependability, efficiency, conveyance efficiency, water surface elevation ratio, infrastructure effectiveness, and water delivery ratio. In addition, farmers’ perceptions and management practices were examined through interviews and discussions with irrigators and Water User Association members. The results showed that water adequacy was fair at the head reaches of secondary canals but poor at the middle and tail sections. Equity ranged from good to fair, while conveyance efficiency was relatively high in the main canal (89.52%) but considerably lower in secondary canals (61.50–67.11%) due to seepage, cracks, sediment accumulation, and vegetation growth. Maintenance indicators revealed serious infrastructure failures and frequent canal blockages. Farmers expressed dissatisfaction with water distribution fairness, maintenance practices, and management coordination. Overall, the Erer Irrigation Scheme operates below its design potential due to combined technical, operational, and institutional challenges. Rehabilitation of infrastructure, strengthening of Water User Associations, improved water scheduling, and systematic maintenance are recommended to enhance scheme performance and sustainability.