Drought has great negative impact on farm households’livelihood.This paper analyzes the relationship between rainfall and crop yield,definition of drought and its impact and the coping strategies of farm households.The results show that southern China is charaterized with local drought and regional drought,drought causes farm households’ huge loss and farm households’ consumption is also affected and farm households’ diversified activities and the uniform utilization of village public resources are the important methods to cope with drought.The paper puts forward six suggestions on how to mitigate the impact of drought in southern China on agricultural production and farm households’ livelihood,such as breeding drought-resistant varieties to reduce the dependance on water,improving the capacity of village community to deal with drought,constructing water storage facilities for farm households,understanding the risk strategies by farm households to cope with drought and making scientific agricultural risk management policy,establishing governmental management system in separating drought and flooding and strengthening the environmental protection in southwestern China to promote the agricultural sustainable development.