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Protected areas, a corestone of biodiversity conservation, provide a vast array of ecosystem services to support livelihoods of people. However, protected areas, especially freshwater, are under threat with overexploitation of resources changing the land covers and degrading their capacity to supply services. Information on land cover changes and its implications on ecosystems, its services and people, especially in developing countries at a local scale, is largely absent. This study, therefore, seeks to understand people's dependency on ecosystem services and implications of land cover change on ecosystem services and people, with a case study in the Koshi Tappu Wildlife Reserve of Nepal. Using both qualitative and quantitative methods, our findings show high dependency of the locals on a vast array of ecosystem services provided by the reserve. More than half of the sampled households were found to directly derive income from ecosystem services of the reserve. However, land cover changes especially declines in forest (16%), swamps/marshes (4%), rivers (14%) and other ecosystems over a period of 34-years impacted the provision of ecosystem services and peopleâs dependency notably. The services from forests declined by about 94%, swamps services by 36% and services from river by 57% which were reported to be the high service suppliers. People's dependency, as perceived by the locals, was reduced by 67% over the last ten years. The study highlighting the supply, demand and implications on ecosystem services and people helped to better understand the complex interaction between humans and ecosystems. These results can be used to develop holistic approaches to restore, conserve and manage the ecosystems, and its services by balancing equal supply and demand of ecosystem services required for a self-sustaining human-environment system. It can also contribute to development of important environmental policies and programs in the area.