The Middle East hosts a high diversity of terrestrial and freshwater biota. However, this biodiversity is under threat from climate change, overexploitation and land-use change-particularly through irrigated agriculture and urbanization. Biodiversity data for the region remain fragmented and sparse, creating significant knowledge gaps that hinder effective conservation planning. We investigated how land-use types and water availability influence multiple dimensions of freshwater biodiversity, using Odonata (dragonflies and damselflies) as bioindicators. We analysed 12,770 occurrence records for 144 Odonata species across the Middle East to estimate taxonomic (TD), phylogenetic (PD) and functional diversity (FD), applying incidence-based Hill numbers with rarefaction and extrapolation. Our results show that the availability of long-lasting water bodies significantly enhances all facets of Odonata diversity, underscoring the importance of stable aquatic habitats. Urbanization had consistently negative effects across all biodiversity dimensions, likely due to the limited availability of suitable aquatic and terrestrial habitats. Agricultural land use had a positive effect on TD and PD, possibly explained by the creation of artificial irrigation water bodies, but showed no effect on FD-suggesting a homogenization of functional traits and the dominance of species with similar ecological roles. While agricultural expansion may enhance regional biodiversity, its potential to drive functional homogenization raises concerns about ecosystem resilience. Moreover, its long-term sustainability is uncertain due to accelerating groundwater depletion and salinization across the region. These findings highlight the urgent need for region-specific research and integrated water management strategies to balance development with biodiversity conservation in arid regions.