Hydrological response is governed by complex interactions among climate, topography, land use, and soil characteristics, making water balance assessment fundamental for understanding watershed processes. This study evaluates the hydrological response of the Andhiyarkhor watershed (2236 km2), located in the Mahanadi River Basin, India, using the Soil & Water Assessment Tool (SWAT). The watershed was delineated into 23 sub-basins and 80 hydrological response units (HRUs), and hydrological simulations were performed using ArcSWAT within ArcGIS 10.4 for 1990–2018. Model calibration (1990-2007) and validation (2008–2018), together with sensitivity and uncertainty analyses, were carried out using the SUFI-2 algorithm in SWAT-CUP. Model performance was evaluated using the R2, NSE, RMSE, and Percent Bias (PBIAS). Sensitivity analysis identified the SCS Curve Number (R_CN2) and groundwater delay time (V_GW_DELAY.gw) as the most influential parameters affecting streamflow. The calibrated model performed well, with post-calibration NSE values of 0.84 during calibration and 0.89 during validation, while R2 reached 0.94 for both periods. The post-calibration analysis revealed a significant increase in runoff, accounting for 49.75% of total precipitation, which is nearly half of the basin's rainfall. This helped to establish a critical baseline for local water conservation. The close agreement between observed and simulated streamflow confirms SWAT ability to reproduce watershed hydrological processes accurately, demonstrating its robustness as a decision-support tool for sustainable and climate-resilient watershed management in central Indian river basins.