<p>Drought is growing increasingly severe with climate change, and Central and Eastern Europe is particularly vulnerable to drought impacts due to its extensive agricultural land use. Hungary has experienced several damaging droughts in recent decades, including the exceptionally dry year of 2011, when annual precipitation reached only 72% of the climatological normal. This highlights the need for reliable tools to simulate drought events and assess related risks. However, it remains uncertain whether regional climate model (RCM) settings can accurately reproduce extreme droughts, given their known tendency to generate too frequent and too light precipitation. The aim of this paper is to evaluate how different physical parameterization schemes influence the representation of drought characteristics in RCM simulations. To address this, we performed a set of 10-km resolution hindcast experiments with RegCM4.7 over Hungary for 2011, using ERA-Interim reanalysis as boundary conditions. We tested multiple combinations of land surface, microphysics, convection, and planetary boundary layer schemes to quantify their individual and combined contributions to model uncertainty. The results show that RegCM is most sensitive to the choice of the convection parameterization, which strongly affects the amount, intensity, and temporal distribution of precipitation. Interactions with land surface and microphysics schemes further modify key drought-related variables, including soil moisture and surface energy fluxes. The influence of each parameterization type also shows seasonal variability, leading to substantial differences among the simulated drought characteristics.</p>