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Water availability is fundamental to societies and ecosystems, but our understanding of variations in hydroclimate (including extreme events, flooding, and decadal periods of drought) is limited because of a paucity of modern instrumental observations that are distributed unevenly across the globe and only span parts of the 20th and 21st centuries. Such data coverage is insufficient for characterizing hydroclimate and its associated dynamics because of its multidecadal to centennial variability and highly regionalized spatial signature. High-resolution (seasonal to decadal) hydroclimatic proxies that span all or parts of the Common Era (CE) and paleoclimate simulations from climate models are therefore important tools for augmenting our understanding of hydroclimate variability. In particular, the comparison of the two sources of information is critical for addressing the uncertainties and limitations of both while enriching each of their interpretations. We review the principal proxy data available for hydroclimatic reconstructions over the CE and highlight the contemporary understanding of how these proxies are interpreted as hydroclimate indicators. We also review the available last-millennium simulations from fully coupled climate models and discuss several outstanding challenges associated with simulating hydroclimate variability and change over the CE. A specific review of simulated hydroclimatic changes forced by volcanic events is provided, as is a discussion of expected improvements in estimated radiative forcings, models, and their implementation in the future. Our review of hydroclimatic proxies and last-millennium model simulations is used as the basis for articulating a variety of considerations and best practices for how to perform proxy-model comparisons of CE hydroclimate. This discussion provides a framework for how best to evaluate hydroclimate variability and its associated dynamics using these comparisons and how they can better inform interpretations of both proxy data and model simulations.We subsequently explore means of using proxy-model comparisons to better constrain and characterize future hydroclimate risks. This is explored specifically in the context of several examples that demonstrate how proxy-model comparisons can be used to quantitatively constrain future hydroclimatic risks as estimated from climate model projections.