Coal mining is one of the core industries that contribute to the economic development of a country but deteriorate the environment. Being the primary source of energy, coal has become essential to meet the energy demand of a country. It is excavated by both opencast and underground mining methods and affects the environment, especially hydrological cycle, by discharging huge amounts of mine water. Natural hydrological processes have been well known to be vulnerable to human activities, especially large scale mining activities, which inevitably generate surface cracks and subsidence. It is therefore valuable to assess the impact of mining on river runoff for the sustainable development of regional economy. In this paper, the impact of coal mining on river runoff is assessed in one of the national key coal mining sites, Gujiao mining area, Shanxi Province, China. The characteristics of water cycle are described, the similarities and differences of runoff formation are analyzed in both coal mining and pre-mining periods. The integrated distributed hydrological model named MIKE SHE is employed to simulate and evaluate the influence of coal mining on river runoff. The study shows that mining one ton of raw coal leads to the reduction of river runoff by 2.87 m3 between 1981 and 2008, of which the surface runoff decreases by 0.24 m3 and the baseflow by 2.63 m3. The reduction degree of river runoff for mining one ton of raw coal shows an increasing trend over years. The current study also reveals that large scale coal mining initiates the formation of surface cracks and subsidence, which intercepts overland flow and enhances precipitation infiltration. Together with mine drainage, the natural hydrological processes and the stream flows have been altered and the river run off has been greatly reduced.