According to climate change projections, the Alps will be one of the most affected regions in Europe. A basis for adaptation measures to climate changes is the quantification of the impact. This study investigates the impact of projected climate change on the hydrological cycle in the Upper Soča River basin. It is based on the use of climate model data as input for hydrological modelling. The climatic input data used were generated by a global climate model (IPCC A1B emission scenario) and downscaled for local use. Hydrological modelling was performed using the distributed hydrological model MIKE SHE. The simulated impact was quantified by comparing results of the hydrological modelling for the control period (1971–2000) and different scenario periods (2011–2040, 2041–2070, 2071–2100). The climate projections show an increase in the average temperature (+0.9, +2.3, +3.8°C) and negligible changes in average precipitation amounts in the scenario periods. More distinctive are changes in the temporal pattern of mean monthly values (up to +5.2°C and ±45% for precipitation), which result in warmer and wetter winters and hotter and drier summers in the scenario periods. The projected rise in temperature is reflected in the increased actual evapotranspiration, the reduction of snow amount and summer groundwater recharge. Changes of monthly and period average discharges follow the trends of the meteorological variables. Changes in precipitation patterns have a major influence on the projected hydrological cycle and are the most important source of uncertainty. Estimated extreme flows indicated increased hazards related to floods, especially in the near-future scenario period, while in the far future scenario period, distinctive drought conditions are projected.