The ability of the Hadley Centre Coupled Model, version 3 (HadCM3) ocean-atmosphere general circulation model to represent the mechanisms linking the El Niño–Southern Oscillation (ENSO) and drought in the United States is investigated. Rotated principal components analyses of self-calibrating Palmer drought severity index data are used to categorize the dominant modes of summer drought variability in the observed climate record (1901–2002) and in a 250-year period of a HadCM3 control run. A similar mode of large-scale drought variability is identified in both data sets that is correlated with ENSO variability: a monopolar pattern across the continental interior, centered over the southern states. HadCM3 successfully reproduces the displacement of the midlatitude jet streams during ENSO events, a mechanism related to U.S. drought variability, but the model appears to be less realistic in its simulation of the influence of Rossby wave teleconnections on drought, which is possibly due to limitations in its simulation of ENSO in the equatorial Pacific. Despite this we conclude that HadCM3's simulation of the link between ENSO and U.S. drought is sufficiently realistic for it to be used in further studies of U.S. drought variability.