Climate and human-driven changes play an important role in regional droughts. Northwest Yunnan Province is a key region for biodiversity conservation in China, and it has experienced severe droughts since the beginning of this century; however, the extent of the contributions from climate and human-driven changes remains unclear. We calculated the ecosystem evapotranspiration (ET) and water yield (WY) of northwest Yunnan Province, China from 2001 to 2013 using meteorological and remote sensing observation data and a Surface Energy Balance System (SEBS) model. Multivariate regression analyses were used to differentiate the contribution of climate and vegetation coverage to ET. The results showed that the annual average vegetation coverage significantly increased over time with a mean of 0.69 in spite of the precipitation fluctuation. Afforestation/reforestation and other management efforts attributed to vegetation coverage increase in NW Yunnan. Both ET and WY considerably fluctuated with the climate factors, which ranged from 623.29 mm to 893.8 mm and –51.88 mm to 384.40 mm over the time period. Spatially, ET in the southeast of NW Yunnan (mainly in Lijiang) increased significantly, which was in line with the spatial trend of vegetation coverage. Multivariate linear regression analysis indicated that climatic factors accounted for 85.18% of the ET variation, while vegetation coverage explained 14.82%. On the other hand, precipitation accounted for 67.5% of the WY. We conclude that the continuous droughts in northwest Yunnan were primarily climatically driven; however, man-made land cover and vegetation changes also increased the vulnerability of local populations to drought. Because of the high proportion of the water yield consumed for subsistence and poor infrastructure for water management, local populations have been highly vulnerable to climate drought conditions. We suggest that conservation of native vegetation and development of water-conserving agricultural practices should be implemented as adaptive strategies to mitigate climate change.