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Background Projecting future streamflow variation or the hydrological impact of climate change plays a pivotal role in the sustainable implication of planning water resources management. Therefore, this study predicts the potential of climate change’s impact on hydrological components in the Upper Awash Basin (UAB). The study applied a statistical downscaling model (SDSM) to generate future high-resolution climate data from the climate model output of the Canadian Second Generation Earth System Model (CanESM2) and the National Centers for Environmental Prediction (NCEP) under the representative concentration pathways (RCP4.5 and RCP8.5) scenarios. To analyze the trend of future rainfall and temperature, non-parametric Mann-Kendall, Modified Mann-Kendall tests, Sen’s slope estimator, and changing point (Pettit) tests were used. The output of downscaled climate data is used as input to a calibrated and validated Soil and Water Assessment Tool (QSWAT) model to assess the impact of future climate change on UAB hydrology. Results The results show that annual rainfall and temperature are significantly increased (p < 0.05) in the UAB under RCP4.5 and 8.5 for the model ensemble mean for both short- and long-term scenarios. The change in the rainfall, the maximum and minimum temperature is mostly visible in the second period (the 2060s). Climate change is likely to cause persistent decreases in surface runoff (SUR_Q) and increases in actual evapotranspiration (ET) under all climate scenarios in the three periods. Reduction in SUR_Q despite an increase in rainfall could be due to an increment in both temperature and ET. The study also identified inconsistent seasonal changes in projected future precipitation that considerably impact overall climatic conditions. Conclusions This research is essential to develop an interdisciplinary approach that integrates environmental policies for the coherent use and management of water resources for future climate change and ecological protection in the basin, including other similar basins.