Water has been identified as a key resource for Nepal's economic growth. Although the country has 225 billion cubic meters of water available annually, less than 7% has been utilized. Climate change is a frequent topic in national development discussions in part because of its possible impact on future water availability. This study assessed the likely impact of climate change on water resources development in the Koshi River basin, Nepal, using the Soil and Water Assessment Tool to generate projections for the 2030s and 2050s. Results suggested that the impacts are likely to be scale dependent. Little impact is projected at annual, full-basin scales; but at sub-basin scale, under both the IPCC's A2 and B1 scenarios, precipitation is projected to increase in the upper transmountain subwatersheds in the 2030s and in most of the basin in the 2050s and to decrease in the lower sub-basins in the 2030s. Water yield is projected to increase in most of the basin except for the A2 scenario for the 2030s. Flow volumes are projected to increase during the monsoon and postmonsoon but decrease during the winter and premonsoon seasons. The impacts of climate change are likely to be higher during certain seasons and in some sub-basins. Thus, if infrastructure is in place that makes it possible to store and transfer water as needed, the water deficit due to any changes in rainfall or flow patterns could be managed and would not be a constraint on water resources development. The risks associated with extreme events such as floods and droughts should, however, also be considered during planning.