The National Climate Change Research Facility (NCCARF) is undertaking a program of Synthesis and Integrative Research to synthesise existing and emerging national and international research on climate change impacts and adaptation. The purpose of this program is to provide decision-makers with the information they need to manage the risks of climate change. This report on drought and the future of rural communities in regional Victoria forms part of a series of studies/reports commissioned by NCCARF that look at historical extreme weather events, their impacts and subsequent adaptations. These studies examine particular events - primarily extremes - and seek to explore prior vulnerabilities and resilience, the character and management of the event, subsequent adaptation and the effects on present-day vulnerability. The reports should inform thinking about adapting to climate change - that is, capacity to adapt, barriers to adaptation, and translating capacity into action. While it is recognised that the comparison is not, and never can be, exact, the over-arching goal is to better understand the requirements of successful adaptation to future climate change. This report compares the impact of drought in two agricultural communities, Mildura and Donald. The Big Dry, or Millennium Drought, has affected southeast Australia since the mid-1990s. Although there has been a return to wet La Niña conditions, it will be several seasons before conditions will return to 'normal'. This drought had serious impacts on water availability, agricultural production (due to decreased irrigation allocations), biodiversity (due to prolonged changes in habitats) and bushfire regimes. Two case studies (Mildura and Donald) were chosen to investigate the socio-economic impacts of drought, past and present drought adaptation measures, and the future adaptation strategies that will be required to deal with projected increases to the frequency and magnitude of drought events.