The aim of this paper is to analyze the spatial and temporal characteristics of drought in the Pinios River Basin, a water-limited Mediterranean basin in Thessaly, Greece, by comparing drought indices calculated by ground-based meteorological observations and satellite-derived data. Drought analysis was carried out for the period of October 1981–September 2002 using the Standardized Precipitation Index (SPI) and the Standardized Precipitation Evapotranspiration Index (SPEI) at multiple time scales, in comparison with the Surface Runoff Index (SRI) representing hydrological drought. Ground precipitation and temperature data were spatially interpolated using a Multiple Linear Regression method to create a 487-pixel grid (5X5 km). The CHIRPS precipitation data and the ERA5 reanalysis temperature data had the same resolution as the ground-observed data to allow comparisons. The potential evapotranspiration was estimated by the Thornthwaite method. Correlation analyses confirmed the satisfactory agreement between ground-based and remote sensing data. The results identified the severe and persistent droughts during the late 1980s, early 1990s, and early 2000s, with their spatial extent and intensity effectively captured by the indices calculated by the remote sensing data. Furthermore, the drought indices of various time scales were compared for an unregulated sub-basin of the Pinios River with the SRI index, and the results indicated that a meteorological drought index (SPI and/or SPEI) at a 6-month time scale correlates well with the SRI. Overall, the results demonstrate that satellite data from international databases can serve as a cost-effective and reliable alternative in regions with sparse observational networks, offering significant value for drought monitoring and water resources management in Mediterranean environments.