Drought is a costly natural hazard affecting socio-economic activity and agricultural livelihoods, as well as adversely impacting public health and threatening the sustainability of many natural environments. This study was carried out to characterize the temporal and spatial characteristics of meteorological drought in the upper Blue Nile basin to provide a framework for sustainable water resources management. Analysis of historical droughts was undertaken by converting observed monthly precipitation records (1960–2008), for 22 meteorological stations, to the standardized precipitation index (SPI). The SPI was computed at multiple time steps and the Mann–Kendall test was applied on monthly SPI time series for trend detection, and finally severity areal extent frequency (SAF) curves were developed to assess the recurrence pattern of drought severity. Several drought events were observed during the long rainy season and also the short rainy season, and the drought extent and influence were very severe in 1965 and the 1980s. Trend analysis showed statistically insignificant trends in SPI time series, and SAF curves indicated that droughts with a short return period and high degree will cover only small areas of the basin, while only a near-normal drought with a long return period may spread over the whole region.