The Khudi watershed lies in western Nepal within 28003’-28030’ north, 84011’-84038’ east and 823 m-3000 m above sea level. The agrarian watershed with seven hundred households was dominated by Bahun/Chettri (51%), Gurung (21%) and several others (28%). Temperature and precipitation data analysis between 1987 to 2006 and 1975 to 2006 respectively showed some changes. Temperature was in increasing trend. The maximum mean temperature was increasing at 0.810C/decade and the minimum mean temperature was increasing at 0.260C/decade. Seasonal temperature data also showed increasing trend, winter temperature was highly increasing trend (1.170C/decade maximum and 0.760C/decade minimum temperature trend). Average Precipitation of two trends of driest months, November and December, was decreasing by 0.58 mm/yr and 0.10 mm/yr respectively while that of wettest month, July showed the increasing trend of 1.91 mm/yr. Regarding the experience of local inhabitants, more than 90 percent respondents have experienced increasing temperature, and 91 percent respondents have experienced unusual rainfall events. Fifty percent respondents believed that rainfall amount was decreasing in recent past with direct impacts on agricultural production and water resources. Most of the farming communities experienced unusual weather patterns with negative impacts on agricultural production, increasing water scarcity and increased frequency of weather related disasters. Local adaptive capacity was poor. Knowingly or unknowingly some coping strategies like use of sprinkle irrigation, use of new varieties of crops, were adopted within the communities. There was an urgent need to formulate adaptive strategies for food securities and for dealing with water scarcities and climate change induced disasters.