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Based on the Inter-State Agreement among the Chief Ministers of Madhya Pradesh, Uttar Pradesh and Bihar, Bansagar Control Board was constituted in January 1976 for efficient, economical and early execution of Bansagar Dam and connected works. The respective States carry out works of canals and power systems within their territory. The Control Board has an overall responsibility for construction of the Bansagar dam and its appurtenant structures. Water Resources Department of the Government of Madhya Pradesh, under the direction of the Control Board, is implementing works of the project. The Union Minister of Water Resources is the Chairman of the Board and the Union Minister of Energy, Chief Ministers and Ministers-in-charge of Electricity of Madhya Pradesh are its members. Executive Committee set up under the Chairmanship of the Chairman, Central Water Commission, manages the affairs of the Board.

The Secretariat of the Board is located at Rewa and headed by a Secretary. The BCB is a subordinate office under the Ministry of Water Resources. The expenditure of the offices of the Board is initially met out of the Budget of the Union Ministry of Water Resources and subsequently reimbursed in equal proportions by the States of Madhya Pradesh, Uttar Pradesh and Bihar. The States of Madhya Pradesh, Uttar Pradesh and Bihar share the cost and benefits from the Bansagar Dam in the ratio 2:1:1.