Technical Abstract: Climate varies seasonally, from year to year, decade to decade and over longer periods of time. While seasonal and year-to-year variations in precipitation are readily recognized, variations in average annual precipitation lasting 5 to 50 years, termed decade-long precipitation variations, have the potential to surpass the impacts of short-term variations due to their cumulative effects. For example, the recent and ongoing multi-year drought in the western United States impacts the flows of the Colorado River and the cumulative effects are reflected in low reservoir storages. Once decade-long precipitation variations in the historical record have been categorized into wet and dry periods, expectations of particular precipitation or flow occurrences can be derived for wet and dry periods, and these conditional expectations can be used for planning and management of water resources. The existence of decade-long precipitation variations, their impact on watershed runoff and the conditional probabilities for precipitation and runoff occurrences is illustrated for the 770 km2 Fort Cobb Reservoir watershed in central Oklahoma. A trend analysis of the 1940-2004 annual precipitation of Fort Cobb watershed identified three dry periods in the 1950s, 1960s, and late 1970s, and one extended wet period in the late 1980s and 1990s. The difference in average annual precipitation between dry and wet periods was 250 mm/yr or 33% of long-term mean precipitation. These wet and dry periods led to corresponding variations in watershed runoff. For the Fort Cobb watershed, the 33% change in mean annual precipitation led to a 100% change in mean annual runoff. The shift in the probability of exceedance curves between wet and dry periods for precipitation or runoff is similarly large, and can potentially provide useful information for management of water resources.