Forests play a pivotal role in regulating climate and sustaining the hydrological cycle. The biophysical impacts of forest on clouds, however, remain unclear due to the lack of direct observations. In this first global-scale observational study, we use long-term satellite-derived cloud cover data to show that forests can have opposite effects on summer cloud cover. We find enhanced cloud cover over most temperate and boreal forests, but inhibited cloud cover over Amazon, central Africa, and Southeast US. These cloud effects mainly arise from convection processes associated with forests. The spatial variation in the sign of cloud effects is driven by sensible heating where cloud enhancement (inhibition) is more likely to occur when sensible heat in forest is larger (smaller) than nearby nonforest. Ongoing forest cover loss has led to opposite cloud cover changes, with local cloud increase over forest loss hotspots in the Amazon (+0.78%), Indonesia (+1.19%), and Southeast US (+0.09%), but cloud reduction in East Siberia (-0.20%) from 2002-2018. Our data-driven assessment informs the climate effects of local-scale forest cover change and improves mechanistic understanding of forest-cloud interactions, the latter of which remains uncertain in Earth system models.