In this paper, the problem of optimal rehabilitation of water distribution networks (WDNs) for both steady and transient state is investigated. Two objectives are considered in this study: minimizing rehabilitation cost by considering pipe size diameters as decision variables and minimizing the transient impacts by minimizing a surge damage potential factor (SDPF). A multi-objective ant colony optimization (MOACO) model is developed to solve this problem. The developed model is verified using the well-known New York City tunnel network. The application is carried out to modify an existing real WDN in New Cairo district designed in steady-state conditions to cope with the transient condition. The advantage of this study is to produce a set of solutions that help decision makers to identify the suitable approach, while evaluating and aggregating the preferences over multiple objective functions.