The ecohydrologic effects of urbanization that is dominated by forests clearing are not well understood in the southeastern United States. We utilized long-term monitoring data to quantify the annual water balance, stormflow characteristics, and seasonal flow patterns of an urbanized watershed (UR) (0·70 km2) and compared it to a fully forested watershed (FOR) (2·95 km2) in central North Carolina. The goal of this study was to assess how past urbanization altered watershed hydrology and to offer reference data for urban watershed planning. The mean annual discharge coefficient (discharge/precipitation) in the UR and FOR from 2000 to 2007 was 0·42 and 0·24, respectively. The UR generated about 75% more stormflow than the FOR. The UR had a lower mean evapotranspiration (ET) rate (58%) than the FOR (77%). Peakflow rates and stormflow volume of the UR were higher (e.g. 76·6 mm/day versus 5·8 mm/day for peakflow rate and 77·9 mm/day versus 7·1 mm/day for stormflow volume) than the FOR, especially during the growing season. Growing season precipitation minus discharge normalized by precipitation (P − Q)/P (i.e. normalized ET ± change in water storage) was higher in the FOR compared to the UR. Differences between the two watersheds occurred mostly during the growing season and became smaller during the dormant season. We conclude that intensive urbanization elevated watershed peakflow rates and annual discharge volumes partially due to reduction in ET during the growing season. Maintaining ET capacity of vegetation in an urbanizing watershed is important in development planning for reducing stormflow and watershed degradation. Published 2011. This article is a US Government work and is in the public domain in the USA.