The relationship between the interannual changes in streamflow, precipitation and temperature of the Murray-Darling basin is investigated by using a two-parameter climate elasticity of streamflow approach. The non-linear relationship between streamflow and both precipitation and temperature indicates a greater streamflow sensitivity to precipitation than to temperature but a more significant impact of temperature change on streamflow than previously reported. The physical mechanisms producing high streamflow sensitivity to temperature change are not well understood, but may relate to concurrent changes in sub-annual precipitation characteristics such as seasonality, spatial distribution and intensity. Thus these characteristics need to be assessed and accounted for when attempting to project how streamflow, and hence water availability, may change in a future warmer world.