We demonstrate that for losing reaches with significant diurnal variations in stream temperature, the effect of stream temperature on streambed seepage is a major factor contributing to reduced afternoon streamflows. An explanation is based on the effect of stream temperature on the hydraulic conductivity of the streambed, which can be expected to double in the 0° to 25°C temperature range. Results are presented for field experiments in which stream discharge and temperature were continuously measured for several days over losing reaches at St. Kevin Gulch, Colorado, and Tijeras Arroyo, New Mexico. At St. Kevin Gulch in July 1991, the diurnal stream temperature in the 160-m study reach ranged from about 4° to 18°C, discharges ranged from 10 to 18 L/s, and streamflow loss in the study reach ranged from 2.7 to 3.7 L/s. On the basis of measured stream temperature variations, the predicted change in conductivity was about 38%; the measured change in stream loss was about 26%, suggesting that streambed temperature varied less than the stream temperature. At Tijeras Arroyo in May 1992, diurnal stream temperature in the 655-m study reach ranged from about 10° to 25°C and discharge ranged from 25 to 55 L/s. Streamflow loss was converted to infiltration rates by factoring in the changing stream reach surface area and streamflow losses due to evaporation rates as measured in a hemispherical evaporation chamber. Infiltration rates ranged from about 0.7 to 2.0 m/d, depending on time and location. Based on measured stream temperature variations, the predicted change in conductivity was 29%; the measured change in infiltration was also about 27%. This suggests that high infiltration rates cause rapid convection of heat to the streambed. Evapotranspiration losses were estimated for the reach and adjacent flood plain within the arroyo. On the basis of these estimates, only about 5% of flow loss was consumed via stream evaporation and stream-side evapotranspiration, indicating that 95% of the loss within the study reach represented groundwater recharge.