Soil erosion and sedimentation which is partly impacted by climate change is one of the most important land degradation problems, as it removes soil rich nutrients and increases level of sedimentation in rivers and reducing reservoirs storage capacity. The main objective of this study was to evaluate the impact of climate change on sediment yield in Gumero watershed near Makesegnit. Gumero watershed is found in northeastern part of Lake Tana basin between the watersheds Arno-Garno and Megech with area of 116 km2. In order to simulate the future discharge and sediment yield the PED-W model was calibrated with observed discharge and sediment data recorded in years (2014 and 2015) and validated with the year (2016). The future rainfall and temperature data was downscaled from two RCP 2.6 and RCP 8.5 emission scenario climate models of GCM dataset. The downscaled data was bias corrected the coarse resolution output of climate model to fine resolution using linear scaling bias correction method. Bias corrected future rainfall and potential evapotranspiration data under climate change effects with other landscape input parameter was applied in the calibrated PED-W model as input to simulate the future discharge and sediment yield. PED-W model was found good in predicting discharge with Nash-Sutcliffe Efficiency (NSE) of 0.71 and 0.69 for the calibration and validation periods, respectively. While an NSE of 0.56 was recorded in sediment modeling during the calibration periods. The result of this study showed that average mean annual temperature increase up to 0.94-5.37oC and precipitation will decrease up to 8.3-145.8 mm/year in the watershed for future three time periods under both emission scenarios. As a result the predicted average annual minimum discharge and sediment yield change will decrease up to 9.51mm/year (-1.1%) and 0.64 ton/ha/year (7.2%) under 8.5 emission scenario of 2020s future time period and average annual maximum discharge and sediment yield change will decrease up to 402.95 mm/year (34.2%) and 3.94 ton/ha/year (-44.3%) under 8.5 emission scenario of 2080s future time period respectively