Study regionSoutheast Australia. Study focusWe investigated meteorological and hydrological drought characteristics using Standardized Precipitation Index (SPI), Standardized Streamflow Index (SSFI) and Effective Drought Index (EDI). Drought Hazard Index (DHI) was derived based on the probability of drought occurrence and Thiessen polygons using SPI/EDI, whereas Drought Frequency Index (DFI) was derived based on number of drought events, and data length using SPI, EDI, and SSFI. The modified Mann-Kendall test was applied to detect trends in streamflow data and hydrological droughts. Furthermore, correlation between meteorological and hydrological drought indices for different timesteps was assessed through Pearson’s and Spearman’s rank correlation analysis. Finally, the drought propagation time (DPT) from meteorological to hydrological drought was estimated by ‘theory of run.’ New hydrological insights for the regionOur major findings include: (i) The spatial coverage of DHI and DFI, based on SPI/EDI, illustrate that mainly south and coastal regions of the study area are the most ‘drought-prone’ (ii) A considerable proportion of streamflow stations shows a significant trend of decrease in annual streamflow, with the most dominant year of abrupt change is 1996; (iii) Hydrological droughts are increasing in the study area; (iv) Performance of EDI with SSFI is found to be better than SPI at 3-month timestep; and (v) DPT can be found using ‘theory of run’ however, defined DPT cannot be directly applied to other regions.