Accurately analyzing the water system’s status in a region is crucial for mitigating water resource constraints on the development of island areas. This study centers on Zhoushan, an archipelago city, and employs the water footprint theory (WFT) and the logarithmic mean Divisia index (LMDI) model to scrutinize the evolution of water footprints from 2010 to 2020. It also dissects the impacts of economic, technological, and population factors on these changes. The findings are as follows: From 2010 to 2020, Zhoushan’s total water footprint has remained relatively stable, but its structure is imbalanced, indicating an unhealthy development. The agricultural water footprint dominates, though its proportion has steadily declined from 64% to 28%, while the imported water footprint has significantly increased from 2% to 29%. The skewed distribution of internal and external water consumption contributes to this imbalance, with internal water use accounting for a staggering 86.43%.