Experimental psychologist Dr Peter Rogers and his colleagues from the University of Bristol carried out tests on 60 volunteers.
Their reactions were then tested by getting them to press a button in response to prompts on a computer screen.
The volunteers either drank nothing before the test or had a cupful (330 millilitres) of tap water, chilled to 10 °C.
New Scientist magazine reports that people who were thirsty at the beginning of the test and took a drink performed 10% better than those who drank nothing.
But the "hit rate" of those who were not thirsty to start with dropped by 15% after a drink.
Dr Rogers said that drinking too much water might affect the ability to drive or perform intellectually demanding tasks.
He thinks that the temperature of the drinks might explain part of the effect.
Divert resources
The body has to divert resources to deal with the local cooling effect in the gut.
Dr Rogers told BBC News Online: "The effects we found in the study were as great as those we have observed in studies of the effects of caffeine.
"Ingestion of food and fluid, while necessary to sustain life, poses in the short term a physiological challenge.
"It may be that diversion of physiological resources to handle the ingested water is responsible for the effect on performance.
"In this respect the temperature of the water, as well as amount, may be important.
"We served the water moderately cold - it may be that colder, or hot drinks would have a greater detrimental impact, and body temperature water the least."
Dr Rogers said the body would always be able to compensate for the detrimental effect of drinking when faced with extreme situations.
Health experts recommend drinking plenty of water. The British Dietetic Association currently suggests drinking six to eight cups or glasses of water, tea, coffee, juice, or sugar free drinks per day.