The Trump administration rolled out a six-month test program in Texas on Monday that will draw on volunteer expertise and technology from cyber and artificial intelligence companies to protect the water sector.

“Project Watershed 250” is the first of the state-based, industry-centric pilot projects to cross the finish line that the Office of the National Cyber Director has previewed since the publication of its national cybersecurity strategy earlier this year. Water systems have long been viewed as among the most vulnerable and neediest critical infrastructure sectors, and in recent months the sector has been the victim of a spree of attacks.

“Project Watershed 250 is a commitment from the states, industry and federal government that we will continue to prioritize our nation’s safety and deliver on America-first policies for the American people,” National Cyber Director Sean Cairncross said at a rollout event in San Antonio Monday.

“U.S. companies are providing world-class cyber capabilities, red teaming that tests utilities’ current defenses, system hardening using the latest private sector cyber tools and AI tooling that helps utilities’ frontier cyber defenders to protect Texas water systems and scale proven solutions across the country,” he said. “This six-month pilot program is designed to make our water and wastewater critical infrastructure more resilient and resistant to cyber attacks by proactively finding and fixing system weaknesses.”

The pilot program, featuring collaboration between federal and state governments, stands in contrast to how the Biden administration tried to tackle the issue, with audit requirements that some GOP states challenged in court, forcing Biden’s Environmental Protection Agency to withdraw its rule.

“For too long, at least on the federal level, the government has admired the problem of cybersecurity in water systems,” Cairncross said. “We are going to find out what works. We’re going to target that, and we are going to scale off of this and learn lessons.”

A dozen companies — Parsons, Microsoft, Fortinet, Google Cloud, Palo Alto Networks, Amazon Web Services, Reflection AI, Cloudflare, Zscaler, Forescout, Abnormal AI and Dragos — appeared at the rollout Monday to praise the initiative and tout their contributions to it.

Not everyone praised the initiative elsewhere, however. One cyber professional who works on water security issues, speaking on condition of anonymity, said the program was “all smoke” and that “there’s no real money behind it.”

“The White House did what it always does — reached out to industry with their hands out asking for industry to pay for things the government should be doing, at least in part,” the person said.

Texas Gov. Greg Abbott said the program would be overseen by Cairncross’s office and Texas Cyber Command, which was established just last year. Abbott cited the need for the program by mentioning “an Iranian-backed cyberattack” on 30 water systems across 12 states and a 2024 attack on the water system in Muleshoe, Texas, suspected to be the work of Russian hackers.

“The need for cyber resilience is overwhelming,” Abbott said. “Many rural providers simply don’t have the resources they need to be able to protect themselves.”

Watershed 250 isn’t the only federal effort to bolster water cybersecurity, with lawmakers introducing legislation in the aftermath of the recent attacks. Past legislation that Congress has enacted also sought to tackle the problem.

Updated 8/31/26: with comment from cyber professional.

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Unit 42’s top brass has seen enough from internal frontier AI model testing and malicious in-the-wild use of commercially available AI tools to be genuinely concerned.

“I can tell you without exaggeration that we believe that this is a generational shift in cybersecurity,” Sam Rubin, senior vice president of Palo Alto Networks’ threat intelligence arm, said in a media briefing Wednesday. 

A period of relative balance between security and exposure has been broken by frontier AI model capabilities that could allow attackers to find and exploit network weaknesses with speed, Rubin said.

Unit 42 warned that capabilities demonstrated by readily available agentic AI models, and those unlocked by frontier AI models that remain gated for defense, have shifted the balance of power from defenders to attackers.

“The defenses that we’ve had built up over years weren’t necessarily built for or prepared for these machine-speed attacks,” Rubin said. “Organizations are ill-equipped to detect and to respond quickly in the face of these attacks.

Back in April, when Anthropic brought Palo Alto Networks and other major technology companies together to form Project Glasswing, an initiative to find and address security defects with its Mythos model, Unit 42 estimated the same capabilities would be in the hands of attackers within a year. 

“Well, here we are five months later, and we’re starting to see the early waves of this threat in the wild,” Rubin said. 

Unit 42 is actively investigating an attack on one of its customers where an attacker used an agentic framework to exploit 50 applications and other weaknesses across the enterprise in less than 10 hours. Rubin estimates AI allowed the attacker to accomplish in 10 hours what would have taken at least 10 days in a pre-AI era. 

Attackers are already using AI across the entire attack chain, said Sherrod DeGrippo, vice president of threat intelligence at Unit 42. “We are not far from fully agentic attacks across all at once, but right now it’s piece by piece by piece,” she said. 

“AI has seeped into every part of what threat actors do,” including malware development at scale, delegation, social engineering and ransomware negotiations, DeGrippo added.

As such, she sees the threat landscape shifting in four areas. AI is a force multiplier, identity is the primary compromise vector, attackers are burrowing into foundational libraries and software supply chains “baked into the fabric of our digital world,” and nation-sponsored threat groups are learning more about points of weakness in enterprise systems, DeGrippo said.

Nobody is fully prepared for what’s coming and it would be naive or a bad defender mindset to think otherwise, she said. “This is a transformative period, and how organizations navigate that transformation is going to be make-or-break for a lot of them.”

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