This review examines the behaviour and productivity of the water buffalo (Bubalus bubalis) under different breeding systems and in relation to meat and milk production. At present, the steady increment in the consumption of products and sub-products of this species has generated the need to increase the number of animals incorporated into production by progressively expanding the use of stabling systems, reducing the space available to these animals, and applying techniques developed previously for meat and milk production in bovines. However, because such adaptations often fail to take into account important biological and behavioural features of these animals, they may result in serious problems of animal welfare. On the other hand, it is known that water buffaloes adapt well to humid tropical climates, especially in systems that provide extensive, continuous pastureland. These species are highly susceptible to thermal stress, a fact that leads them to constantly perform wallowing behaviour. For all these reasons, open-air and, above all, silvopastoral, systems represent attractive options because they combine the presence of forage plants with trees that provide natural shade and serve as wind barriers, thus attenuating the negative effects of tropical climes. These measures help increase productivity by promoting greater forage consumption and fostering the expression of the species’ natural behaviours, but the reduction in human contact affects their welfare. Hence, this review concludes that welfare is a fundamental concept that must be taken into account in the development of systems for water buffalo production.