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Drought is a natural disaster that affects millions of people across the globe. Lack of rainfall reduces crop yields and livestock productivity and, in turn, food availability and income. In developing countries, these effects are even more detrimental. As droughts become more frequent, adaptation is a fundamental concern for countries and their policymakers. To support a development of drought adaptation policies, a combined hydrologic and system dynamics model was developed for a region in East Africa, focused on the Horn of Africa (i.e., a region bordering Kenya, Somalia, and Ethiopia), an area that has endured multiple droughts in the last few decades. The model simulates the interdependencies between water availability, land degradation, food availability, and socioeconomic welfare. The impacts of new adaptation policies on the region were evaluated over a 10-year simulation period using historical weather data. It was found that a combination of increased hydraulic infrastructure and innovative agricultural practice policy can reduce domestic water deficits by 54-100 % while increasing the income per capita up to 285 % over the 10 years. Innovatively combining hydrologic and systems dynamic modeling produces a realistic simulation of water scarcity and the effects on natural systems. Implementation of policies within the model aids the selection process by evaluating multiple options, quantifying the effectiveness the policies have on individual stakeholder livelihood (i.e., pastoralist, agro-pastoralists, and farmers), and analyzing the overall outcome to ensure equitable costs and benefits among the stakeholders. [ABSTRACT FROM AUTHOR]