Drought events significantly influence the regional dynamics of crop growth conditions under climate change. In Bangladesh, the Ganges-Jamuna-Brahmaputra Floodplains are increasingly diminished by the rising frequency and severity of drought events, posing significant challenges to agricultural systems. This study investigates long-term drought dynamics using multi-source satellite data and drought indices to evaluate the spatial and temporal impacts of drought alongside climate-driven changes in water use efficiency (WUE) across the agricultural ecosystem. The Vegetation Health Index (VHI), Standardized Precipitation Index (SPI), and Advanced Drought Response Index (ADRI) were used to evaluate drought severity from 2002 to 2022. VHI quantifies agricultural drought, SPI measures meteorological drought using remote sensing precipitation data, and ADRI provides an advanced drought response perspective. The SPI shows mild droughts nearly every year, with extreme drought in 2006 and moderate-to-severe droughts in 2006, 2013, 2014, and 2018, when experienced below-average annual precipitation of 2337 mm. Satellite-derived SPI exhibited a strong and highly significant correlation with weather station observations (R-2 = 0.94, p < 0.0001). Additionally, MODIS-derived datasets were analyzed to explore the relationship between drought dynamics and WUE. Annual VHI trends indicated mild-to-moderate drought, with severe droughts in 2006, 2011, 2013, 2014, and 2016. Severe pre-monsoon droughts occurred in 2006, 2013, 2014, and 2018, while post-monsoon drought responses varied, benefiting Boro rice production in 2009, 2014, and 2018. The monsoon season remained largely drought-free due to sufficient rainfall. Strong correlations between VHI and ADRI (R-2 = 0.98, p< 0.001) and between SPI from remote sensing and weather station data (r = 0.94, p < 0.0001) validated the satellite-based approach. WUE averaged 13.47 g C m(-2) mm-1, peaking at 19.87 g C m(-2) mm(-1) in 2004 and reaching a low of 7.11 g C m(-2) mm(-1) in 2002. These findings will contribute to mitigating drought impacts by enhancing agricultural strategies and refining climate change-focused agroecological zoning in Bangladesh and similar climatic regions across continental scales.