As pressure increases on the availability of water resources worldwide, especially in the face of climatic change, it is probable that the likelihood of streams undergoing at least some periods of drying will increase in arid and semi-arid regions. This has implications for the ongoing management of waterways in these areas. One area of concern is the potential occurrence of hypoxic blackwater events upon re-instatement of flows in creek and river channels following periods of drying. Hypoxic blackwater events are characterised by high levels of dissolved organic carbon (DOC), the metabolism of which results in low dissolved oxygen (DO) in the water column, which can cause fish and crustacean mortality. Therefore, understanding hypoxic blackwater events is important in order to reduce the potential for fish mortalities and other water quality impacts from both managed and natural flows. In this study, we set out to determine the factors that influenced the occurrence of a hypoxic blackwater event in the Edward-Wakool river system, in southern NSW, Australia during the previous austral summer (2008–2009). Standing stocks of plant litter, emergent macrophytes and river red gum saplings (Eucalyptus camaldulensis Dehn.), as well as rates of litterfall, were determined in dry and inundated channels. A series of mesocosm experiments were undertaken to determine which carbon source was the greatest contributor to DOC and to DO depletion, and what loadings could result in hypoxia. These experiments were then used to create a simple algorithm relating carbon loading in a dry channel to DOC in the overlying water column following inundation. Results revealed that plant litter was the main contributor to water column DOC and to DO depletion. Litter loadings equal to or greater than 370 g m−2 were found to cause DO in a shallow (20 cm) water column at 20 °C to fall to zero within two days. This loading was approximately half of that found in dry channels in the Edward-Wakool system – thus, initial inundation of these channels at a low flow rate during summer (or when water temperature is equal to or greater than 20 °C) is highly likely to trigger a hypoxic blackwater event. In addition, one month of litterfall in summer was calculated to be sufficient to deliver enough carbon to dry channels to create a hypoxic blackwater event. These findings suggest that to reduce the likelihood of a hypoxic blackwater event occurring as a result of managed flows in ephemeral systems; (1) the principal source(s) of DOC as well as the pathway and timing of accumulation in dry channels should be identified, and (2) the timing of the re-instatement of flows in a dry channel should be considered in light of the timing of maximum rates of accumulation of the principal source(s) of DOC.