Droughts have been an important factor in disaster management in Korea because she has been grouped into nations of lack of water. Satellite imagery can be applied to droughts monitoring because it can provide periodic data for large area for long time. This study aims to present a process to analyze droughts in large area using satellite imagery. We estimated evapotranspiration in large area using NDVI data acquired from satellite imagery. For satellite imagery, we dealt with MODIS data operated by NASA. The evapotranspiration estimated from satellite imagery was combined with precipitation data and potential evapotranspiration data to estimate water balances. Using water balances we could analyze droughts effectively in our object area. As the result of this study, we could increase the usability of satellite imagery, especially in droughts analysis.