High power water-cooled diode lasers are finding increasing demand in biomedical, cosmetic and industrial applications, where repetitive cw (continuous wave) and pulsed cw operation modes are required. When operating in such modes, the lasers experience numerous complete thermal cycles between "cold" heat sink temperature and the "hot" temperature typical of thermally equilibrated cw operation. It is clearly demonstrated that the main failure mechanism directly linked to repetitive cw operation is thermo-mechanical fatigue of the solder joints adjacent to the laser bars, especially when "soft" solders are used. Analyses of the bonding interfaces were carried out using scanning electron microscopy. It was observed that intermetallic compounds, formed already during the bonding process, lead to the solders fatigue both on the p- and n-side of the laser bar. Fatigue failure of solder joints in repetitive cw operation reduces useful lifetime of the stacks to hundreds hours, in comparison with more than 10,000 hours lifetime typically demonstrated in commonly adopted non-stop cw reliability testing programs. It is shown, that proper selection of package materials and solders, careful design of fatigue sensitive parts and burn-in screening in the hard pulse operation mode allow considerable increase of lifetime and reliability, without compromising the device efficiency, optical power density and compactness.