Threat management for water distribution infrastructure systems should develop plans for responding to hazards, including the presence of contaminants in the system and failure of physical components. In the event that the delivery of clean and reliable drinking water is threatened, the complex interactions among managers` operational decisions, consumers` water consumption choices, and the hydraulics and contaminant transport in the water distribution system will influence public health consequences. A Complex Adaptive System (CAS) approach is developed here to couple process models of the pipe network with agent-based models of consumers and public officials. Development of threat management strategies, which would prescribe a set of actions to mitigate the situation, is enabled through a simulation-optimization framework that couples heuristic search methods with the CAS model. The framework is demonstrated for an illustrative case study to identify efficient threat management strategies to achieve public health protection and maintain acceptable levels of service.