Robust increases in temperatures will occur globally across the twenty-first century; however, for some regions, sign changes in rainfall remain uncertain. Navigating this uncertainty is crucial in addressing drought-related challenges faced by climate-exposed sectors. New Zealand represents these challenges, exhibiting significant model uncertainty in warm-season rainfall change. Here, we examine how temperature-driven increases in potential evapotranspiration interact with contrasting storylines of future rainfall to explore drought outcomes for New Zealand. In our drying storyline, we find that increasing temperatures accompanied by less rainfall bring forward the onset of drought several months and delay its termination. In the wetting storyline, increases in rainfall partly offset the temperature-induced drying effect, leading to minor reductions in soil moisture. Examining extreme years, the average hydrological year in the future becomes comparable to the driest years of the current climate, while the worst future events exhibit unprecedented drought severity.