Many studies have already documented climatic change impacts on the overall Hindu Kush Himalaya and its large-scale river basins, such as the Ganges and Indus. However, uncertainties regarding climate change impact and future hydrological variability for the intermediate-scale basin within these larger systems like Karnali (45,496 km2) are limited. A detailed assessment of climate change impacts on the Karnali River basin is essential, especially considering the importance of streamflow generated in the hills and mountains of the basin for livelihoods and nature conservation. In this study, we, therefore, integrate the high-resolution (500 m) fully distributed hydrological model (Spatial process in Hydrology SPHY) with CMIP6 climate projection forcing data to understand the future spatio-temporal trends and heterogeneity in the water balance components at the sub-basin scale. We analyze the climatic and hydrological extremes (high flow and low flow) and evaluate how the change in water balance and streamflow components can change the vulnerability of the basin. Our findings enhance the understanding of climate-hydrology interactions in the upstream area of the Karnali River Basin under climate change projections to support the studies in the low flat lands focusing on biodiversity conservation.