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The Budyko framework is a simple but effective tool for watershed water balance estimation. Accurate estimation of the watershed characteristic parameter (Pw) is critical to accurate water balance simulations using the Budyko framework. However, there is no universal quantification criterion for the Pw because of the complex interactions between hydrologic, climatic, and watershed characteristic factors at global scales. Therefore, this research introduced the hydrologically similar groups principle into the Budyko framework and defined the criteria for quantifying Pw in similar environments. We classified global watersheds into six groups based on watershed attributes, including climate, soil moisture, and vegetation, and identified the controlling factors of the Pw in each hydrologically similar group. Our results show that the Pw is closely related to soil moisture (SM) and the power function gradually changes from positive to negative as soil moisture increases. The relationship between the Pw and fractional vegetation cover (FVC) can be described with different linear equations in different hydrologic similarity groups, except in the group with no strong seasonality and moist soils. Based on these relationships, a model for estimating the Pw (PwM) was established with multiple non-linear regression methods between the Pw and its controlling factors (SM and FVC). Then, we used bootstrapping and runoff reconstruction methods to verify the usability of PwM. The validation results illustrate that PwM overall presents a satisfactory performance through bootstrapping (R2 = 0.63) and runoff reconstruction (R2 = 0.89). Results show that the hydrologically similar groups method can quantify the Pw and the improved Budyko framework can aptly simulate global runoff, especially in humid watersheds. This study lays the basis for explaining the Pw in the Budyko framework and improves the applicability of the Budyko framework for estimating global runoff.