Due to the climate warming and enhancement of human impacts, the menaces of drought disaster in safety of food supplies, water resources and ecology become more remarkable, and the great challenges of ability for impact evaluation, disaster mitigation and emergency management are brought forward. Thus, the technological level of drought monitoring, warning, evaluation, mitigation and management need to be improved. In this paper, based on the summary of the advances in drought research, our understandings on arid climate, drought and drought disaster are put forward, the key characteristics of rid climate, drought and drought disaster are generalized, and the courses to develop drought indices, the main properties of different sorts of drought indices and their mutual relationships are analyzed. Finally, according to the future situation of science and technology development and the service demand of society, the scientific challenges and the ways to develop the technology on drought are preliminarily discussed.