Food security in sub-Saharan Africa is dependent on rainfed agriculture and is a serious issue. Irrigation is considered an important strategy to meet food insecurity. However, the limited water availability is a challenge for expanding irrigation. The application of appropriate farmland management such as conservation agriculture with different irrigation application and scheduling technologies increase the productivity of crops per drop of water and improve the soil fertility. However, the benefits of conservation agriculture under different irrigation scheduling on smallholder irrigated farms have not been adequately investigated in the Ethiopian highlands. A 4-year irrigated conservation agriculture experiment was conducted to investigate the overall impact on irrigation water use, hydrology, and soil nutrient accumulation on vegetable farms in the Ethiopian highlands. The study area is located in Dengeshita experimental site in the headwaters of Blue Nile basin. Conservation agriculture in this study consists of no-tillage and application of grass mulch at the rate of 2 t ha−1, while conventional tillage is the current farmers' practice of 4–6 tills and without mulch cover. Irrigation water amount and scheduling were managed by the researcher using estimated reference evapotranspiration (ETo) and by farmers' local practices. Finally, the research process and results of the treatments were evaluated using Agricultural Policy and Environmental eXtender model (APEX). On-farm experimental results from irrigated vegetables (onion and garlic) in the dry monsoon phase showed that the yield and irrigation water use efficiency (IWUE) was over 40% greater under CA than conventional tillage (CT) practices. A supplementary irrigated and rain-fed experiment on pepper (Capsicum annuum L.) production indicated that conservation agriculture practices significantly improved water management, and reduced irrigation water use by 10% and runoff by 40% while it increased percolated water in the root zone by 27% when compared with CT practice. The study also revealed that CA practice decreased the NO3- N and PO4-P load in leachate by about 10% while NO3-N and PO4-P loads in runoff respectively, by about 159% and 50%. Besides, the yield return achieved under CA treatment was about 20% higher when compared with the CT. Moreover, the soil organic matter, total nitrogen, and available phosphorus of soils under conservation agriculture (CA) showed an increment compared with the CT over soil depths in 4 years period. The increase in these nutrients for CT at the topsoil depth was caused by the application of fertilizer and cattle manure in both dry and wet phases of vegetable production while the higher nutrient availability in the CA was attributed to the incorporation of grass mulch combined with cattle manure, fertilizer, and no-tillage over 4-years of irrigated vegetable production.Since field research over large areas can be unreasonably costly and time-consuming to study at a large spatial scale, the Agricultural Policy/Environmental eXtender (APEX) model was run to evaluate the effect of conservation agriculture practices on water and nutrient loads in runoff under small on-farm experimental plots. In this regard, APEX model performed well in simulating the CA and the CT practices for different response variables under irrigated and supplementary irrigated vegetable production systems. It has shown a 15% decrease in simulated ET, 70% decrease in runoff, 23% decrease in nitrogen load of runoff, and 54% decrease in phosphorus loads of runoff while it showed a 20% increase in root zone soil water and 59% increase in percolated water under CA compared with the CT treatment. The reason for the different responses of the simulated variables to CA and CT practices was obviously due to the combined use of grass mulch cover and no-tillage practices under CA treatment. APEX simulations indicated the contribution of such practices to the reductions in ET and runoff, which was the main reason for higher water-saving observed during the dry irrigation phases of various vegetable production under CA treatment.