The retention lake often plays an important role in flood mitigation through the water storage and the lake–river interactions. However, the evolution of real-time flood regulation capacity remains poorly characterized. Using wavelet decomposition and flood peak removing ratios, this study presents a comprehensive evaluation of the characterization, mechanism, and impacts of the flood regulation capacity in Dongting Lake. The results indicate that the change of flood regulation effect of the lake can be well reflected by the multi-year changes in the variances of the inflow and outflow runoffs. The wavelet decomposition indicates that the flood regulation of the lake is mainly functioned on the high-frequency floods with durations less than 32 days. The average yearly flood peak removing ratios range from 0.13 to 0.56, but no significant tendency changes on the effect of the flood regulation capacity has happened during the study period. The changes in maximum regulation volume reveal that the flood regulation of the Dongting Lake is mainly a passive process decided by the complex river–lake relationship and the interactions among different processes of discharge and sediment. The impacts from the large volume reduction caused by sedimentation in the lake is compensated by the increased flood controlling water level, which in turn have resulted in the new phenomenon of “normal discharge, high water level and disaster” in the lake regions after the 1990s. The significant impacts on the lake–river relationship caused by the sediment reallocation from the operation of the Three Gorges Reservoir (TGR) have further changed the hydrological regimes between the lake and the Yangtze River. Influenced by the new lake-river interaction pattern the discharge passing capacity downstream the outlet of the lake is becoming a key factor that affects the flood regulation capacity, which is leading to a shift of the flood pressures from the lake region to the downstream of Yangtze in the near future.
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