Chat (Catha Edulis) is the current highly expanded and a commercially available crop in eastern Africa and the Arabian Peninsula. It becomes one of Ethiopia's largest crops by cultivated area, the country's second-largest exporter, and an essential source of income for millions of Ethiopian farmers. The study of its effect of plantation on the hydrological response is crucial for effective water management, protection of surface runoff erosion, and land degradation. To analysis the hydrological response (runoff, soil loss, and moisture) of chat cultivation, we established four runoff plots in the humid subtropical highland of Lake Tana basin, Aba Gerima watershed. Each plot had an area of 18 m2 (6 m × 3 m) representing initial (P1), developmental (P2), maturity (P3) growth stages of the chat plantation and a control (P0) plot to monitor runoff, soil loss and moisture during 2018 and 2019 periods. Soil moisture availability was determined by using the gravimetric method of measurement and installing EC-5 (Decagon Devices Inc., Pullman, WA, U.S.A) sensor. For each experimental plot treatment, the efficiency in the reduction of runoff and soil loss increases as the growth stage of the chat increases. The seasonal runoff ranged from 104 to 296 mm (1872 to 5328 liters) in 2018 and 283 to 852 mm (5148 to 15336 liters) in 2019 whereas, the seasonal soil loss ranged from 2.45 to 13.56 t ha-1 in 2018 and 6.81 to 26.57 t ha-1 in 2019. The average crop evapotranspiration calculated by the water balance method was 124.3 mm and the total irrigation water depth required to the chat field for the study period was 6144 mm, which is a volume of 110.6 m3 of water. The total available soil moisture at P0, P1, P2, and P3 was 193.91, 276.17, 354.69, and 380.21 m3 m-3 respectively. Thus, the availability of soil moisture has increased with the age of chat plantation. Our results show that chat cultivation has strongly influenced the hydrological dynamics of our study basin. This understanding will help policymakers plan for the proper water management in such a voraciously expanded chat plantation in Ethiopia and elsewhere.