The large areas being targeted for tropical forest restoration as part of the UN Decade on Ecosystem Restoration will have major consequences for the flow of water through landscapes. Whilst the prevailing mantra that ‘more forest implies less streamflow’ remains true in terms of annual water yields, we demonstrate that opportunities for increased tree cover to improve seasonal flow regimes of streams, particularly baseflows, are important. We discuss several potential positive feedbacks of forest restoration on hydrological processes at various scales, including ‘trade-offs’ between changes in vegetation water use and infiltration after foresting degraded land; the recovery of the capacity of vegetation to capture ‘occult’ precipitation in specific coastal and montane settings; and enhanced moisture recycling and transport at various scales. Modelled changes in baseflow after foresting all degraded land climatically capable of carrying forest in the tropics suggested a positive effect in 10% of the land. For an additional 8%, the effect was predicted to be about neutral (<2 mm/y). We conclude that a more positive narrative regarding the relationship between tropical forestation and water availability is justified. It is time for greater involvement of hydrologists and atmospheric scientists in the development and assessment of forest landscape restoration efforts.