Land use and land cover is a fundamental variable that affects many parts of social and physical environmental aspects. Land use and land cover changes (LUCC) has been known as one of the key drivers of affecting in ecosystem services. The trans-boundary Gandaki River Basin (GRB) is the part of Central Himalayas, a tributary of Ganges mega-river basin plays a crucial role on LUCC and ecosystem services. Due to the large topographic variances, the basin has existed various land cover types including cropland, forest cover, built-up area, river/lake, wetland, snow/glacier, grassland, barren land and bush/shrub. This study used Landsat 5-TM (1990), Landsat 8-OLI (2015) satellite image and existing national land cover database of Nepal of the year 1990 to analyze LUCC and impact on ecosystem service values between 1990 and 2015. Supervised classification with maximum likelihood algorithm was applied to obtain the various land cover types. To estimate the ecosystem services values, this study used coefficients values of ecosystem services delivered by each land cover class. The combined use of GIS and remote sensing analysis has revealed that grassland and snow cover decreased from 10.62% to 7.62% and 9.55% to 7.27%, respectively compared to other land cover types during the 25 years study period. Conversely, cropland, forest and built-up area have increased from 31.78% to 32.67%, 32.47–33.22% and 0.19–0.59%, respectively in the same period. The total ecosystem service values (ESV) was increased from 50.16 × 108 USD y−1 to 51.84 × 108 USD y−1 during the 25 years in the GRB. In terms of ESV of each of land cover types, the ESV of cropland, forest, water bodies, barren land were increased, whereas, the ESV of snow/glacier and grassland were decreased. The total ESV of grassland and snow/glacier cover were decreased from 3.12 × 108 USD y−1 to 1.93 × 108 USD y−1 and 0.26 × 108 USD y−1 to 0.19 × 108 USD y−1, respectively between 1990 and 2015. The findings of the study could be a scientific reference for the watershed management and policy formulation to the trans-boundary watershed.