Numerical study is conducted to understand the effects of additional H₂O on downstream interaction in CO-O₂ counterflow premixed flames. Adding 1% H₂O to fuel side for freely-propagating premixed flame with CO-O₂ mixture increases laminar burning velocity from 5.3 cm/s to 81.8 cm/s in a way that the main oxidation reaction is changed from CO + 0.5O₂ → CO₂ to CO + OH → CO₂ + H. When global strain rate reaches 23.5 s-1 for interacting CO-O₂ premixed flames, the flames cannot be sustained. While for (0.1% H₂O + CO)-O₂ premixed flames, the flame is extinguished at 2687 s-1. Because the fuel Lewis number and effective one are larger than unity, downstream interaction are mainly through chemical one. For lean-lean (rich-rich) flames, the production of O (H) radical is vigorous, resulting in the formation of OH via H₂O + O → OH + OH (H₂O + H → OH + H₂). These different chemical situations can influence downstream interactions in various flame configurations. Such interesting aspects in chemical interactions are presented and discussed in detail.