There is growing concern over the effects of climate change on glacier melt and hydrology. In this article, we used two natural small-scale basins, Tuotuo River and Buqu River in the source region of the Yangtze River, China, to show the impacts of glacier melt on stream flow. Changes in the extent of glaciers and ice volume in 1970, 1992 and 2009 are evaluated using remote sensing images. Changes to the glacier surface area over the same time interval are estimated through the delineation of glacier outlines and positions using Landsat TM/ETM+ imagery. By 2009, the glacier surface area had decreased by 20.83% and 34.81% of the 1970 values in Tuotuo River and Baqu River basins respectively. The total meltwater supply in each basin is estimated to be 2.56x10(9) m(3)/yr and 1.24x10(9) m(3)/yr respectively. Mass balance calculations show that glaciers in the study area suffered a constant mass loss of snow and ice, accumulatively approximately -24 m over the past 40 years. The annual and summer stream flow tended to increase in Tuotuo River basin from 1970 to 2009 while a negative trend of change was shown in Buqu River basin during 1970-1986. Glaciers became shorter, narrower and thinner under the effect of atmospheric warming. Streamflow increase has been recorded at Tuotuo River station in response to increased glacier and permafrost melt. However, streamflow decrease has been recorded at Yanshiping station on Buqu River, where glacier melt has lagged behind atmospheric warming. These results show a close but variable linkage among climate change, glacier melting and water resources in the source region of the Yangtze River.