The San Bernardino area of southern California has complex water-management issues. As an aid to local water managers, this report provides an integrated analysis of the surface-water and ground-water systems, documents ground-water flow and constrained optimization models, and provides seven examples using the models to better understand and manage water resources of the area. As an aid to investigators and water managers in other areas, this report provides an expanded description of constrained optimization techniques and how to use them to better understand the local hydrogeology and to evaluate inter-related water-management problems. In this report, the hydrology of the San Bernardino area, defined as the Bunker Hill and Lytle Creek basins, is described and quantified for calendar years 1945-98. The major components of the surface-water system are identified, and a routing diagram of flow through these components is provided. Annual surface-water inflow and outflow for the area are tabulated using gaged measurements and estimated values derived from linear-regression equations. Average inflow for the 54-year period (1945-98) was 146,452 acre-feet per year; average outflow was 67,931 acre-feet per year. The probability of exceedance for annual surface-water inflow is calculated using a Log Pearson Type III analysis. Cumulative surface-water inflow and outflow and ground-water-level measurements indicate that the relation between the surface-water system and the ground-water system changed in about 1951, in about 1979, and again in about 1992. Higher ground-water levels prior to 1951 and between 1979 and 1992 induced ground-water discharge to Warm Creek. This discharge was quantified using streamflow measurements and can be estimated for other time periods using ground-water levels from a monitoring well (1S/4W-3Q1) and a logarithmic-regression equation. Annual wastewater discharge from the area is tabulated for the major sewage and power-plant facilities. More...