Smart irrigation controllers (SICs) can save water by adapting watering schedules to climate and soil conditions. The potential benefit of SICs is particularly high in southwestern U.S. states, where the arid climate makes water scarcer and increases watering needs of landscapes. A number of studies have tested the ability of SICs to save water in residential and small commercial settings. Results generally show overall savings, but there is substantial variability, including cases of increased water use. Though there are many controllers on the market, we argue there is a further need for optimization of design and field performance. To inform the technology development process, we develop a design for environment method, which overlays economic and environmental performance parameters under different operating conditions. This method is applied to characterize design goals for controller price and water savings that SICs must meet to yield life cycle carbon dioxide reductions and economic savings in southwestern U.S. states, accounting for regional variability in electricity and water prices and carbon overhead. Results from applying the model to SICs in the Southwest suggest that some areas are significantly easier to design for. One concept to realize improved design in practice is to build out the controller market in a staged set of niches, starting from a more favorable area then moving toward more challenging conditions.