NSW is holding firm on its threat to walk away from the Murray-Darling Basin Plan, while Victoria has left the door ajar to negotiations with the federal government.

Labor and Greens senators voted down changes which would have secured more water for farmers, angering the states and putting the plan's future in serious doubt.

Victorian Labor premier Daniel Andrews said on Thursday he was disappointed with the scuttling of the water distribution changes, but pledged to work with Canberra to find a solution.

While he conceded the way forward would be difficult, his Water Minister Lisa Neville said the plan was "over".

NSW Water Minister Niall Blair said the plan was now "untenable" for the state's farming communities along the river system.

He said walking away from the plan would allow the future of western NSW to be secured.

But Queensland urged NSW and Victoria to stay in the agreement which was signed by the Gillard Labor government in 2012.

"It's been so many years, we need to end the uncertainty," Queensland's Natural Resources Minister Anthony Lynham said.

The Turnbull government was trying to reduce the amount of water being returned to the environment in states upstream in the basin to support farmers and industries in those regions.

Last year, NSW was embroiled in a water theft scandal when irrigators and farmers took more than their allocated water share.

Federal Assistant Water Minister Anne Ruston said the government was open to federal Labor's concerns about compliance.

"We are calling on all parties to come back to the table. Nothing positive can be gained by this plan being blown up," Senator Ruston told reporters in Canberra.

The Greens, who led the charge in sinking the government's changes to the plan, want an independent audit into allegations of corruption and water theft.

"It was a shot across the bow. Get your house in order," SA Greens senator Sarah Hanson-Young said.

South Australia, in the south of the basin, accused NSW and Victoria of never being committed to the plan.

SA Water Minister Ian Hunter accused the federal government of lacking leadership on the issue and of being beholden to the Nationals, who hold the federal water portfolio.

"Victoria and NSW are trying to ... get a better deal for themselves and cut the South Australian component right out and we just won't stand for it," Mr Hunter told ABC Radio on Thursday.

The Murray-Darling system takes in 23 rivers, supports more than four million people and stretches across South Australia, Victoria, NSW and Queensland.

The Murray Darling Basin Plan determines the amount of water that can be taken from the basin for urban, industrial and agricultural use.