Chief Minister K Palaniswami launched the Rs 100 crore 'kudimaramathu' project at Manimangalam in neighbouring Kancheepuram district.
'Kudimaramathu' is a practise where people contribute a percentage of capital or physical labour in managing water resources and this was in vogue a long time ago.
The state government, as part of its strategy to face the unprecedented drought and a looming water crisis in Tamil Nadu following deficient monsoon, had earlier decided to revive this system.
In the current financial year, works including removal of weeds from canals, maintenance of lakes and strengthening various infrastructure will be taken up, a government release said.
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Palaniswami said the focus of 'kudimaramathu' was rejuvenating groundwater resources through various measures, which would ultimately benefit farming and farmers.
Referring to the drought situation in Tamil Nadu, he said the government has allocated a total of Rs 2,247 crore as relief to affected farmers, which has been provided to the beneficiaries directly through banks.
Recalling his recent meeting with Prime Minister Narendra Modi, Palaniswami said the former had accepted to consider the state government's plea for a Rs 39,565 crore drought-relief package.