The laws you want to learn about are called "water rights". Western water rights laws (which are the predominate legal framework in the US West) basically say "first in time, first in right". The people who used that water first have the ownership rights of that water flow.
So it would be illegal in Colorado to build such a dam because you would be blocking the water that belongs to someone else.
In Colorado, it is illegal to collect the rainwater that lands on your roof because that water would normally flow into a river and that river water belongs to someone else. I used to live in Colorado and about 10-15 years ago, there was a change in the state law that the media proclaimed made it legal for you to collect the rainfall that landed on your roof. They left out the conditions that the statute required: you had to have an existing well permit, you could only use the rainwater for the same purposes that your well permit allowed (so if the permit only allowed watering livestock, you could not use the water for your garden), then there was another stickler - there could not be a water utility adjacent to your property (even if you were not connected to that water company). There were 3 other requirements, but those 3 were so narrowly focused that the law basically upheld the illegality of collecting rainfall.
Interesting. But I don't understand why "first in time" applies to states downstream of the source. The water started as ice melt in Colorado's mountains. So why isn't Colorado "first in time?" Is it because in the case of Colorado building a dam, they'd be utilizing the water (instead of just letting it flow), but Arizona was utilizing it before them (by pumping from it to drink)? And if that's the case, then surely Colorado can apply the same logic so long as they have some water facilities powered by the upstream flow? Also, Colorado was settled as a state before Arizona (IIRC), so they must have been using the water before anyone in Arizona was.
So it would be illegal in Colorado to build such a dam because you would be blocking the water that belongs to someone else.
In Colorado, it is illegal to collect the rainwater that lands on your roof because that water would normally flow into a river and that river water belongs to someone else. I used to live in Colorado and about 10-15 years ago, there was a change in the state law that the media proclaimed made it legal for you to collect the rainfall that landed on your roof. They left out the conditions that the statute required: you had to have an existing well permit, you could only use the rainwater for the same purposes that your well permit allowed (so if the permit only allowed watering livestock, you could not use the water for your garden), then there was another stickler - there could not be a water utility adjacent to your property (even if you were not connected to that water company). There were 3 other requirements, but those 3 were so narrowly focused that the law basically upheld the illegality of collecting rainfall.