A reconstructed pattern of Lateglacial and Holocene hydrological changes in the area of the former lakes Dūbas, Pelesa and Matara is presented. The investigated basin is situated in southeastern Lithuania, beyond the marginal ridge of the Weichselian Glaciation, on the margin of the sandy plain that is the watershed between the Ūla and Katra rivers. Pollen analysis, radiocarbon dating, loss-on-ignition measurements and GIS-based simulation of water level fluctuations have been applied in order to obtain new information on the development of the Ūla–Katra watershed area. The results of multiproxy investigations revealed the history of the development and extinction of Dūbas, Pelesa and Matara lakes. A single basin, covering a large part of the study area, had formed after the retreat of the continental ice sheet from southeastern Lithuania. This basin was divided into three separate lakes during the Allerød Interstadial as a result of a drop in water level. Blocking of the drainage by aeolian sediments around the early Boreal caused another rise in the water-table and the successive merging of the separate lakes. Probably as a result of river capture, the single lake was drained abruptly after c. 2000 years. Another river-capture event in the 19th century caused abrupt drainage of the study area, which led to the final extinction of the three lakes.