Despite the importance of glacial lake development in ice dynamics and glacier thinning, in situ and satellite-based measurements from lake-terminating glaciers are sparse in the Bhutanese Himalaya, where a number of proglacial lakes exist. We acquired in situ and satellite-based observations across lake- and land-terminating debris-covered glaciers in the Lunana region, Bhutanese Himalaya. A repeated differential global positioning system survey reveals that thickness change of the debris-covered ablation area of the lake-terminating Lugge Glacier (-4.67 +/- 0.07 m a(-1)) is more than 3 times more negative than that of the land-terminating Thorthormi Glacier (-1 40 +/- 0.07 m a(-1)) for the 2004-2011 period. The surface flow velocities decrease down-glacier along Thorthormi Glacier, whereas they increase from the upper part of the ablation area to the terminus of Lugge Glacier. Numerical experiments using a two-dimensional ice flow model demonstrate that the rapid thinning of Lugge Glacier is driven by both a negative surface mass balance and dynamically induced ice thinning. However, the thinning of Thorthormi Glacier is minimised by a longitudinally compressive flow regime. Multiple supraglacial ponds on Thorthormi Glacier have been expanding since 2000 and have merged into a single proglacial lake, with the glacier terminus detaching from its terminal moraine in 2011. Numerical experiments suggest that the thinning of Thorthormi Glacier will accelerate with continued proglacial lake development.