Recently, the use of gridded rainfall data with high spatial resolutions in hydrological applications has greatly increased. Various types of radar rainfall data with varying spatial resolutions are available in different countries worldwide. As a result of the variety in spatial resolutions of available radar rainfall data, the hydrological community faces the challenge of selecting radar rainfall data with an appropriate spatial resolution for hydrological applications. In this study, we consider the impact of the spatial resolution of radar rainfall on simulated river runoff to better understand the impact of radar resolution on hydrological applications. Very high-resolution polarimetric radar rainfall (XRAIN) data are used as input for the Hydrologic Engineering Center–Hydrologic Modeling System (HEC-HMS) to simulate runoff from the Tsurumi River Basin, Japan. A total of 20 independent rainfall events from 2012–2015 were selected and categorized into isolated/convective and widespread/stratiform events based on their distribution patterns. First, the hydrological model was established with basin and model parameters that were optimized for each individual rainfall event; then, the XRAIN data were rescaled at various spatial resolutions to be used as input for the model. Finally, we conducted a statistical analysis of the simulated results to determine the optimum spatial resolution for radar rainfall data used in hydrological modeling. Our results suggest that the hydrological response was more sensitive to isolated or convective rainfall data than it was to widespread rain events, which are best simulated at ≤1 km and ≤5 km, respectively; these results are applicable in all sub-basins of the Tsurumi River Basin, except at the river outlet.