With approximately 20 % of the world's population living in its downstream watersheds, the Qinghai-Tibetan Plateau (QTP) is considered "Asia's Water Tower." However, grasslands of the QTP, where most of Asia's great rivers originate, are becoming increasingly degraded, which leads to elevated population densities of a native small mammal, the plateau pika (Ochotona curzoniae). As a result pikas have been characterized as a pest leading to wide-spread poisoning campaigns in an attempt to restore grassland quality. A contrary view is that pikas are a keystone species for biodiversity and that their burrowing activity provides a critical ecosystem service by increasing the infiltration rate of water, hence reducing overland flow. We demonstrate that poisoning plateau pikas significantly reduces infiltration rate of water across the QTP creating the potential for watershed-level impacts. Our results demonstrate the importance of burrowing mammals as ecosystem engineers, particularly with regard to their influence on hydrological functioning.