Quantifying the effects of competition for natural resources between different sectors and interests is a key part of natural resource management globally. A major form of land use conflict in natural forests is between water production and timber production. Here we explore trade-offs in water yield resulting from logging in the forested water catchments north-east of Melbourne – the second largest urban settlement in Australia with a current population of five million. It has long been understood that logging significantly decreases water yields in Melbourne’s water catchments. However, the extent of losses of water yield from past logging have rarely been documented. Here, we model changes in water yield in Melbourne’s largest single catchment, the Thomson Catchment, resulting from: (1) past forest management activities (especially clearfell logging), and (2) future forest management scenarios. Our particular focus was on the effects of logging on water yields from ash-type eucalypt forests. This is because these areas have the greatest impact on water runoff due to them receiving the most rainfall and being the forest types subject to the most intensive and extensive industrial logging.