What is a watershed? 
A watershed is simply the land that water flows across or through on its way to a common stream, river, or lake. A watershed can be very large(e.g. draining thousands of square mile to a major river or lake or the ocean), or very small, such as a 20-acre watershed that drains to a pond. A small watershed that nests inside of a larger watershed is sometimes referred to as a subwatershed.
Since water flows downhill from higher elevations to a common body of water, to delineate the watershed boundary for a particular place on a stream or lake, you will need to draw a line along the ridgetops connecting the highest elevation points surrounding the lake or stream.
Importantly, no matter where we live or work, we are in a watershed teeming with unique, inter-related natural processes. These natural forces help shape the watershed landscape, its water quality, and--in turn--our lives. In other words, each watershed--indeed each watershed zone--has unique living and nonliving components that interact, with one element responding to the action or change of another. Knowing your watershed means coming to learn the natural processes working within the watershed boundaries.
In what ways do humans impact watersheds, lakes and streams? Here are the big three human impacts in the watershed and their effect on waterways:
Nutrients come from animal waste, human sewage, and fertilizer runoff. A direct affect of nutrients is increased algae growth, which can lead to fish kills and tatse and odor problems in drinking water.
Bacteria often come from animal waste and human sewage. Bacteria must
be removed from drinking water by disinfectiom, and pose risks to recreatioanl users of streams and lakes. Sewage treatment plants, septic tanks, livestock, and pet waste are common sources of bacteria such as E. coli, Cryptosporidium and Giardia.
Sediment in streams comes from erosion.
Sediment clogs reservoirs, damages stream habitat, and is costly to remove from drinking water. Erosion accelerates when plants and trees are removed.