Nepal is facing a number of challenges for achieving social, economic and environmental development set out in the national development plan. Low economic strength, inadequate infrastructure, low level of social development, lack of institutional capacity, and higher dependency on the natural resource base makes the country vulnerable to change in climatic system including variability and extreme events. The adverse effects of climate stimuli including variability and extreme events will put addition stress on overall development of Nepal. Anticipated changes in the water sector and flow regime found to be most critical as other sectors will be impacted significantly. Retreating glacier and volume of glacier lake outburst related hazards is growing and presumably it will increase under the warmer climate. Key water related disasters would be flood, drought, erosion and landslide that may occur with greater frequency or intensity in the future. Generation of hydroelectricity would be another area of great concern for Nepal unless proper measures take into account in design and implementation of hydropower projects. The National Adaptation Programme of Action (NAPA) appears to be the first attempt to bring different stakeholders, including the government and the civil society, together.