High-resolution and high-precision paleo-hydrological reconstruction is important both in science and in engineering practice. Here we show that the stalagmite δ18O record can be used for paleo-hydrological reconstruction in a monsoon affected area in China. Using the cave δ18O record established by Zhang et al. (Science 322:940–942, 2008), we established a regression equation, which indicates that the 5-point moving average of the Wanxiang Cave δ18O (δ18O5m) can explain 59 % of the variation in the 5-point moving average of annual river flow (Q w,D,5m) at Danjiangkou of the Hanjiang River. Using this equation, we reconstructed Q w,D,5m for the period from 197 AD to 2001. The project of water transfer from south China to north (WTFSCTN) aims to solve the problem of serious water shortage in the north China plain, and reasonable estimation of amount of the water diversion is crucially important. Based on the reconstructed long series of Q w,D,5m (197–2001), we re-assessed the statistical characteristics of the measured Q w,D,5m in short series (1932–2006), — based on the latter the amount of water diversion was designed. The results show that the short series seriously over estimates the annual Q w,D,5m for very dry (18.8 % larger) and extremely dry (21.5 % larger) years, and considerale bias would be yielded when the water diversion amount is determined only based on the short series. In case some very dry years occur, the situation would be serious either for the WTFSCTN water supply or for the eco-systems downstream from the Danjiangkou Reservoir.