AbstractIn the absence of precipitation or any other recharge source, baseflow sustains natural surface water bodies like streams and rivers. It also indicates the quality and quantity of storage in the aquifers underlying the basin. Thus, identifying and extracting baseflow is critical for most hydrological studies, for example, estimating water budget, watershed characteristics, and groundwater surface‐water interactions. Most approaches for baseflow separation are based on recession hydrographs obtained solely from streamflow observations. A few studies have used the absence of precipitation as a filter for extracting baseflows for recession analysis, but not for estimating changes in groundwater storage. We demonstrate that an accurate estimation of drainage characteristic recession timescale 𝐾 for a linear storage‐discharge relationship should be based on carefully selected individual baseflow events extracted from streamflow observations complemented with precipitation observations. The drainage/recession timescale varies with time, even for a single basin, and hence, should not be generalized to a specific range for a wide range of basins. Estimations of groundwater storage trends and aquifer characteristics from streamflow and lumped analysis can be misleading. Event‐based recession analysis yields large variations in characteristic drainage timescales for a given catchment, which appears a more realistic representation of basin‐wide aquifer characteristics that are known to vary with antecedent climate. In the Rock River basin, we find contrasting trends in the estimated groundwater storages in two selected periods, which are then attributed to the contrasting trends in annual rainfall and evapotranspiration. The approach presented here would be beneficial in investigating aquifer characteristics and storage trends.