In the present thesis; for the future hydrological drought, the precipitation, maximum and minimum temperature time series data were downscaled and bias corrected and later used as an input for PED-W saturated excess hydrological model for future stream flow generation of the major rivers in the Lake Tana basin. The main objective of this study was to analyze and characterize the hydrological drought based on hydrological and meteorological indices. The study used PED-W model for future stream flow estimation of the Lake Tana basin major rivers and bias corrected downscaling time series of precipitation, maximum and minimum temperature and later used for DrinC indices calculator for hydrological drought analysis. Throughout the basin, all the meteorological stations has affected by extreme and severe drought with SPI and RDIst values of -1.88 & -2.53 at Aykel, -1.49 & -2.12 at Bahir Dar, -1.93 & -1.75 at Dangila, -2.41 & -1.42 at Debre Tabor and-1.99 & -1.80 at Gondar were observed respectively at year of 2026-2027. Similarly, the results of SDI calculation showed extreme drought in the Tana basin shows a deficit of water at the same year. The results obtained in the years, 2026-2027, 20332034, 2042-2043 and 2054-2055 years are recorded to be years of hydrological drought which already will be aggravated by the impact of climate change. Hence It was recommended that drought mitigation and preparedness plan via integrated water resources management is paramount to prevent the agricultural based economy and livelihood in the Basin.