Abstract: Drought problem must be analyzed and solved at a regional level. Drought studies must focus not only on the hydrological characterization of the phenomena but also the results caused by drought. In this paper the concepts and methods to characterize droughts as regional process are presented. The concepts of risk,reliability,resiliency and vulnerability are applied to characterize regional droughts and provide a theoretical framework for dealing with drought problems. The paper divides the downstream Yellow River irrigated district into 6 sub-regions,and the multivariate stochastic model is used to generate a synthetic series of monthly precipitation at the six sub-regions. Thirty-three years of monthly rainfall data are used to calibrate the parameters of the model. The generated precipitation series is used to perform the study of regional droughts from the point of view of theoretical risk.