Due to the water scarcity in Iran, it is important to provide strategies to reduce water consumption in the agriculture sector. Zycosil is a nanotechnology material that makes a great hydrophobe in the soil. This study was conducted based on completely randomized block design within microlysimeter with the height of 15 cm and the diameter of 8 cm to investigate the hydrophobic effect on the amount of consumed water in pepper. Sweet pepper seedlings were planted in them; then the treatments were applied. The Z25, Z50 and Z75 treatments consisted of  covering 25, 50 and 75 % of the soil surface by Zycosil; these were compared with  the control (Ctrl- no Zycosil application) in three replications. The results showed that Z75 treatment reduced 27% water consumption and increased the fresh yield by approximately 62 %. The increased yield of Z25 and Z50 was 5 and 26 %, respectively. Dry pepper yield was increased in Z25, Z50 and Z75 treatments by 22, 19 and 80%, respectively, as compared to Ctrl treatment. The amount of water consumed was decreased by 10 % per 25% coverage level. The least amount of water use efficiency was observed in the control treatment (1.28 gr/cm3). The Z75 had the highest water use efficiency (2.96 gr/cm3). Hence, the application of hydrophobic material such as Zycosil in the soil surface reduced water evaporation and increased water retention. This increased the yield and water use efficiency.