This chapter analyzes the current institutional, governance and drought management situation in Chile, identifying the main authorities and agencies that are legally entrusted with competences in this area, and specifying the main characteristics of these functions. The most pertinent and applicable tools are subsequently reviewed, conducting a thorough conceptual and practical analysis of the declarations of water scarcity zones due to severe drought and agricultural emergency resulting from water deficit. Finally, it examines the existing gaps and challenges in addressing extreme hydrological events that are generally occurring and continue to be managed as emergencies or disasters.