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Abstract Drought intensity is commonly characterized using meteorologically‐based metrics that do not provide insight into water deficits within deeper hydrologic systems. In contrast, global positioning system (GPS) displacements are sensitive to both local and regional hydrologic‐storage fluctuations. While a few studies have leveraged this sensitivity to produce geodetic drought indices, hydrologic drought characterization using GPS is not commonly accounted for in drought assessment and management. To motivate this application, we produce a new geodetic drought index (GDI) and quantify its ability to characterize hydrologic drought conditions in key surface and sub‐surface hydrologic reservoirs/pools across California. In northern California, the GDI exhibits a strong regional association with surface‐reservoir storage at the 1‐month time scale (correlation coefficient: 0.83) and groundwater levels at the 3‐month time scale (correlation coefficient: 0.87), along with moderate associations with stream discharge at the daily (instantaneous) time scale (correlation coefficient: 0.50). Groundwater in southern California is best characterized with a 12‐month GDI (correlation coefficient: 0.77), and surface‐reservoir storage is optimized with the 3‐month GDI (correlation coefficient: 0.72). Two sigma uncertainties are ±0.03. Differences between northern and southern California reveal that the GDI is sensitive to unique aquifer and drainage basin characteristics. In addition to capturing long‐term hydrologic trends, rapid changes in the GDI initiate during clusters of large atmospheric river events that closely mirror fluctuations in traditional hydrologic and meteorological observations. We show that GPS‐based hydrologic drought indices provide a significant opportunity to improve drought assessment, in California and beyond, by improving our understanding of the hydrologic cycle.