Mr Key made the comments yesterday during his first formal visit to a marae since becoming the country's leader.
He told tribal elders, politicians and others gathered at Pukawa Marae, on the southwestern shores of Lake Taupo, that water allocation was an issue his National-led Government would need to address.
"Maori, without doubt, will be a clear stakeholder when it comes to that debate," he said.
He said he wanted the issue tackled after a first round of reforms to the Resource Management Act were completed between the middle and end of next year because it was in "the strong interests of New Zealand's economic development".
Mr Key told reporters that better allocation of water and tradeable rights were issues that could be considered.
The Crown has yet to concede water ownership to any iwi, and asked about Maori rights to water, Mr Key said: "That's something, ultimately, that will need to be debated. As I said, they are very important stakeholders and I would've thought they would want to argue pretty strongly that they do have rights."
Prof Ngatata Love, a member of the iwi forum which organised Mr Key's visit to the marae, appeared to back his statement.
"There's no question about who owns the lakebeds, the riverbeds," he said.
"We've just got to take the next step, but the fact we can do it in a responsive manner [through dialogue with the Government] is really the key issue."
Labour's Treaty settlements spokesman, Michael Cullen, who helped negotiate the Waikato River deal with Tainui, said water allocation was a long-term issue best approached in a non-partisan way, and his party would be happy to work with the Government to achieve a broad consensus.
At the marae, Mr Key also promised personal involvement in treaty negotiations, saying he was exploring the possibility of moving the Office of Treaty Settlements into the Department of Prime Minister and Cabinet.
He said his Government wanted to ensure progress on treaty negotiations continued because they were a crucial step to ensuring economic independence for Maori. As significant players in fisheries, forestry and agriculture, Maori would also want to participate in climate-change debate, he said.
Mr Key's speech followed a symbolic tying of taura (flax ropes) by him and Tuwharetoa paramount chief Tumu te Heuheu, who said Maori wanted a partnership with the Government that realised "the full potential of iwi and their land, human capital and natural resources".
Maori Affairs Minister and Maori Party co-leader Pita Sharples, who accompanied Mr Key to the marae, said the prime minister's visit had opened doors with Maori.
"He hasn't promised them things he can't give, but he's promised them korero, dialogue, and that's got to be great."
- Juliet Rowan.
