Remote sensing is considered the most effective tool for estimating evapotranspiration (ET) over large spatial scales. Global terrestrial ET estimates over vegetated land surfaces are now operationally produced at 1-km spatial resolution using data from the Moderate Resolution Imaging Spectroradiometer (MODIS) and the MOD16 algorithm. To evaluate the accuracy of this product, ground-based measurements of energy fluxes obtained from eddy covariance sites installed in tropical biomes and from a hydrological model (MGB-IPH) were used to validate MOD16 products at local and regional scales. We examined the accuracy of the MOD16 algorithm at two sites in the Rio Grande basin, Brazil, one characterized by a sugar-cane plantation (USE), the other covered by natural savannah vegetation (PDG) for the year 2001. Inter-comparison between 8-day average MOD16 ET estimates and flux tower measurements yielded correlations of 0.78 to 0.81, with root mean square errors (RMSE) of 0.78 and 0.46 mm d-1, at PDG and USE, respectively. At the PDG site, the annual ET estimate derived by the MOD16 algorithm was 19% higher than the measured amount. For the average annual ET at the basin-wide scale (over an area of 145 000 km2), MOD16 estimates were 21% lower than those from the hydrological model MGB-IPH. Misclassification of land use and land cover was identified as the largest contributor to the error from the MOD16 algorithm. These estimates improve significantly when results are integrated into monthly or annual time intervals, suggesting that the algorithm has a potential for spatial and temporal monitoring of the ET process, continuously and systematically, through the use of remote sensing data.Editor D. Koutsoyiannis; Associate editor T. WagenerCitation Ruhoff, A.L., Paz, A.R., Aragao, L.E.O.C., Mu, Q., Malhi, Y., Collischonn, W., Rocha, H.R., and Running, S.W., 2013. Assessment of the MODIS global evapotranspiration algorithm using eddy covariance measurements and hydrological modelling in the Rio Grande basin. Hydrological Sciences Journal, 58 (8), 1658–1676.