There is a lack of data on water consumption and its role in dairy calves. The water requirements of dairy calves are negligibly defined. Producers pay little attention to whether calves consume enough drinking water (also called free water) as they consider water in milk or milk replacer would satisfy the total water requirement. A recent USDA survey revealed that dairy producers wait on average 17 d to first offer drinking water to newborn calves. Unlike milk or milk replacer directly shunted to the abomasum, drinking water first enters the rumen and then moves to the rest of the gastrointestinal tract. Therefore, drinking water presumably play a unique role in the development of gut and its microbiome in turn affecting nutrient intake, nutrient digestibility, and growth. The present study was conducted 1) to determine if newborn calves consume significant amount of free water separate from the water in milk, and 2) to examine the effects of offering drinking water since birth (W0) vs. 17 days later (W17) on starter intake, health status, growth, nutrient digestibility, and the composition of gut microbiota in young dairy calves. Thirty Holstein heifer calves were randomly assigned to W0 or W17 (n = 15). Calves had free access to drinking water and a starter ration, and bottle-fed with pasteurized waste milk until weaning at 49 d of age. Fresh fecal samples were collected directly from the rectum at 14, 42, and 70 d of age. The DNA were extracted from fecal samples and sequenced using 16S rRNA gene-amplicon sequencing on an Illumina MiSeq system. The sequences were clustered into operational taxonomic units with a 99% similarity threshold. Total fecal output of individual calves was measured over two consecutive days to determine apparent total-tract digestibility (ATTD) of nutrients three weeks post-weaning. Newborn calves consumed a significant amount (0.75±0.05 kg/d) water separate from the water in milk during the first 16 d. Once offered, W17 drank 59% more free water than W0 during the rest of the pre-weaning period. Starter intake of W0 and W17 was similar, but W0 consumed 0.285 kg/d more milk and tended to achieve greater BW and heart girth (HG) compared to W17 during the pre-weaning period. Offering water from birth versus offering it later did not affect the number of days with diarrhea, intensity of diarrhea, and blood hematocrit values. Despite a similar starter intake, W0 had greater hip height, body length, ATTD of ADF and NDF, and gain: feed ratio than W17 post-weaning. At 14 d of age, feces from W0 had a greater number of bacterial species (5908 vs. 4698, P = 0.033) and species richness (Chao1 index, P = 0.042) than feces from W17. The number of bacterial species, and Chao1 index increased with age (P < 0.001) and became similar between W0 and W17 at 42 d of age. At 42 d of age, the abundance of Faecalibacterium prausnitzii, and Bifidobacterium breve previously shown to improve gut health and growth were greater in W0 than W17 (P < 0.040). Overall, the present study highlighted that offering drinking water since birth has a potential to improve growth, nutrient digestibility, feed conversion efficiency, and the abundance of beneficial bacterial communities in the gut of young dairy heifer calves.