In most, but not all of the scientific literature, cutting of forested watershed results in an increase in water yield of a watershed. In this study, a double-mass plot of the cumulative monthly flow of water between 1961 and 2000, from a 79,000 km2 (7.9 million ha) forested watershed feeding into the Mekong River, on cumulative monthly precipitation over the same period, was used to demonstrate a significant decrease in the water yield in 1985. For 10-12 years after 1985, the total water yield from the watershed decreased by 42% (256 mm) while the late (March and April) dry-season flow decreased by almost 80%. From the changes in water yield and an understanding of the local hydrology, we calculated that 75-80% of the forested area was cut, i.e. more than 6 million ha, implying that the decrease in total water yield from the area of the forest that was actually cut, was just over 50%, while the late dry-season flow from the same area was virtually eliminated. We consider that the main reason for the reduction in water yield, after the forest was cut was an immediate increase in dry-season transpiration by the remaining old forest, newly-exposed understorey and regrowth vegetation, all of which were considered to be accessing groundwater in the regolith. The amount of groundwater accessed was sufficient to allow the cut forest to lose water at the potential rate over the whole year. We conclude that restoration of the watershed water flows resulted mainly from forest regrowth.