Mountain regions throughout the world face intense development pressures associated with recreational and tourism uses. Despite these pressures, much of the research on bio-geophysical impacts of humans in mountain regions has focused on the effects of natural resource extraction. This paper describes findings from the first 3 years of a study examining high elevation watershed processes in a region undergoing alpine resort development. Our study is designed as a paired-watershed experiment. The Ranch Brook watershed (9.6 km2) is a relatively pristine, forested watershed and serves as the undeveloped 'control' basin. West Branch (11.7 km2) encompasses an existing alpine ski resort, with approximately 17% of the basin occupied by ski trails and impervious surfaces, and an additional 7% slated for clearing and development. Here, we report results for water years 2001-2003 of streamflow and water quality dynamics for these watersheds. Precipitation increases significantly with elevation in the watersheds, and winter precipitation represents 36-46% of annual precipitation. Artificial snowmaking from water within West Branch watershed currently augments annual precipitation by only 3-4%. Water yield in the developed basin exceeded that in the control by 18-36%. Suspended sediment yield was more than two and a half times greater and fluxes of all major solutes were higher in the developed basin. Our study is the first to document the effects of existing ski area development on hydrology and water quality in the northeastern US and will serve as an important baseline for evaluating the effects of planned resort expansion activities in this area.