This study evaluated the effects of watering regime and fertilizer composition on shallot (Allium cepa L. var. aggregatum) growth, yield, soil physical properties, and irrigation water productivity (IWP) under sandy loam conditions. A split-plot design was used, with watering as the main factor and fertilizer as the subplot. The watering treatments were: W1—watering up to field capacity during both vegetative and generative phases; W2—watering up to field capacity in the vegetative phase and up to allowable depletion in the generative phase; and W3—watering up to allowable depletion in the vegetative phase and up to field capacity in the generative phase. The fertilizer treatments were F1 (NPK) and F2 (NPK + guano + rice husks). Results showed that F2 significantly improved plant height, leaf number, yield, and IWP compared with F1, primarily due to enhanced soil fertility and structure. The W3 treatment produced high yields while saving up to 13% of water and increasing IWP compared with continuous watering (W1). The combination of F2 with W3 yielded the highest productivity (2.92 kg per plot) and improved soil physical quality by reducing particle and bulk densities. Integrating organic amendments with NPK and applying regulated watering up to the allowable depletion limit during the vegetative phase can enhance shallot yield and water-use efficiency in sandy loam soils.