Understanding the hydrologic processes of inland lake basins in the Tibetan Plateau (TP) could provide insights into the responses of Tibetan lake dynamics to climate change. An efficient approach for this purpose is to represent complex hydrologic behaviors of such Tibetan lake watersheds with plausible hydrologic models. In this study, water level fluctuations of Lake Nam Co, an inland lake in the central TP, were investigated using a lumped lake-watershed model. The degree-day factor method was introduced to improve the model applicability in glacier-covered basins. The model simulated the hydrologic processes as well as the lake water budget. Remote sensing images (Landsat MSS, TM, ETM+ and OLI) from 1972 to 2015 were used to identify the glacier and lake boundaries. Multisource climate data (e.g., ground point observation, 0.25o gridded APHRODITE and TRMM 3B42 v7 precipitation products) were used to drive the hydrologic model at a monthly time step. Results of trend analysis showed that basin-wide annual air temperature increased by the rate 0.04°C/yr from 1961 to 2015. Mean annual precipitation slowly increased from 1961 to the mid-1990s, and then rapidly increased from the late-1990s to the mid-2000s, and finally obviously decreased after the mid-2000s. As a response to climate change, glaciers decreased by 62.69km2 (29%) and lake area increased by 91.83km2 (4.7%) from 1972 to 2015. The analysis of lake water budget suggested that, the total basin runoff and on-lake precipitation contributed 1.36km3/yr (66%) and 0.7km3/yr (34%), respectively, to mean annual water gain of the lake. Glacier runoff was 14% of the basin runoff and 10% of the total water gain of the lake. The percentages of lake evaporation, water seepage and water surplus were 65%, 20% and 15%, respectively. Lake level increased with the rate of 0.14m/yr for the study period 1961–2015. It could be concluded that precipitation was the dominant controlling factor for the different magnitudes of lake level rising rates of 0.10, 0.41 and 0.06m/yr for the periods of 1961–1998, 1999–2008 and 2009–2015, respectively.