Abstract Wood is a hygroscopic material and has ability to exchange its moisture content with air. Many mechanical properties are affected by changes in moisture content below the fiber saturation point of wood. This study evaluates the formaldehyde emission and some mechanical properties of poplar and spruce plywood panels manufactured from rotary cut veneers having different moisture content by using urea–formaldehyde (UF) and modified urea formaldehyde by melamine (M+UF). Rotary cut veneers obtained from poplar and spruce logs were classified into three groups and veneers in each group were then conditioned in a climate chamber to either 4–6%, 10–12% or 16–18% moisture content. Plywood panels with three plies and in 6 mm thickness were manufactured for each group. Formaldehyde emission, shear strength, bending strength and modulus of elasticity values of plywood panels were determined. Best bonding results were obtained in plywood panels with veneers having 4–6% moisture content. Lowest mechanical properties were found for plywood panels manufactured from veneers conditioned to 16–18% moisture content. Formaldehyde emission values of poplar and spruce plywood panels decreased with increasing veneer moisture content for both glue types. Formaldehyde emission content of panels decreased with melamine addition into the urea formaldehyde glue mixture.