Based on the farmland water balance principle and the characteristics of rice growth, a rice paddy water balance equation is developed. Using the growth period data of Guangdong Province as a case, the day-to-day dynamic variation of the rice paddy water during all of the growth periods is simulated, and the objective and quantitative evaluation of the damage caused by drought is also given under natural and irrigated conditions. The rice sensitivity coefficient to drought is calculated using the data from experimentation for the first time, and some significant results are obtained.