Adaptive management (AM) is an approach that uses new information on the efficacy of management practices to improve future practices in a structured and iterative way. AM is frequently used to label groundwater management plans that face issues of significant uncertainty about the impacts of proposed projects. AM is proposed as a solution to avoid potential negative impacts that are unclear at the outset of a project. Despite this, there is limited guidance on the use of AM for specific problems involving impacts to groundwater systems. Moreover, previous commentary on AM states that it is not appropriate for all situations. We provide guidance for application of AM to groundwater contexts through an interpretation of AM theory, and by evaluating practical examples of AM, thereby defining adaptive groundwater management (AGM). Two forms of AGM are identified, being broadly consistent with pre-existing AM forms, namely: active AGM and passive AGM. In active AGM, uncertainty reduction regarding predictions of future impacts is integral to management decision-making, whereas in passive AGM, explicit reduction of uncertainty does not feature as a component of decision-making. Furthermore, we comment on characteristics of groundwater management problems that contribute to the applicability of AGM, thereby defining adaptive groundwater management capacity. This work aspires to more effective AGM application, greater transparency in groundwater-related environmental planning, and clearer expectations of AGM for groundwater stakeholders.