Drought and flood have significant impacts on catchment water use and ecological balance. To develop practical drought/flood monitoring indicators that only need a few climate variables, it is fundamentally necessary to explore the relationship between hydrology variables and climate variables for the specific catchment. This study investigates the correlations between lake water level and various time scale climatological indices according to the standardized precipitation index (SPI) and the standardized precipitation evapotranspiration index (SPEI), based on the monthly water level records from Honghu Lake representative gauging stations and the monthly observations of 8 meteorological stations in the Four Lake Basin. The results showed that extreme droughts and floods are primarily controlled by precipitation variability over the Four Lake Basin, and both SPEI and SPI are well related with lake water level of Honghu Lake while the degree of the correlation varies between different seasons and SPEI/SPI time scales, with the highest correlations for rainy summer and autumn months. Generally, the 4-6 month scale SPEI/SPI drought index is most closely correlated with lake water level of Honghu Lake, showing an apparent response of lake water level to the current and former months’ water surplus and deficiency. When compared with the historical time series of monthly average lake water level of Honghu Lake, the 5 month scale SPEI/SPI agrees well with the variability of the lake water level. The response relationship found during the study can not only aid the monitoring and forecasting of flood and drought conditions in the Four Lake Basin based on conventional weather data, but also provides some references for other places of China.