ABSTRACT: Global climate change due to the buildup of greenhouse gases in the atmosphere has serious potential impacts on water resources in the Pacific Northwest. Climate scenarios produced by general circulation models (GCMs) do not provide enough spatial specificity for studying water resources in mountain watersheds. This study uses dynamical downscaling with a regional climate model (RCM) driven by a GCM to simulate climate change scenarios. The RCM uses a subgrid parameterization of orographic precipitation and land surface cover to simulate surface climate at the spatial scale suitable for the representation of topographic effects over mountainous regions. Numerical experiments have been performed to simulate the present-day climatology and the climate conditions corresponding to a doubling of atmospheric CO2 concentration. The RCM results indicate an average warming of about 2.5°C, and precipitation generally increases over the Pacific Northwest and decreases over California. These simulations were used to drive a distributed hydrology model of two snow dominated watersheds, the American River and Middle Fork Flathead, in the Pacific Northwest to obtain more detailed estimates of the sensitivity of water resources to climate change. Results show that as more precipitation falls as rain rather than snow in the warmer climate, there is a 60 percent reduction in snowpack and a significant shift in the seasonal pattern of streamflow in the American River. Much less drastic changes are found in the Middle Fork Flathead where snowpack is only reduced by 18 percent and the seasonal pattern of streamflow remains intact. This study shows that the impacts of climate change on water resources are highly region specific. Furthermore, under the specific climate change scenario, the impacts are largely driven by the warming trend rather than the precipitation trend, which is small.