A new approach for developing multimodel streamflow forecasts is presented. The methodology combines streamflow forecasts from individual models by evaluating their skill, represented by rank probability score (RPS), contingent on the predictor state. Using average RPS estimated over the chosen neighbors in the predictor state space, the methodology assigns higher weights for a model that has better predictability under similar predictor conditions. We assess the performance of the proposed algorithm by developing multimodel streamflow forecasts for Falls Lake Reservoir in the Neuse River Basin, North Carolina (NC), by combining streamflow forecasts developed from two low-dimensional statistical models that use sea-surface temperature conditions as underlying predictors. To evaluate the proposed scheme thoroughly, we consider a total of seven multimodels that include existing multimodel combination techniques such as combining based on long-term predictability of individual models and by simple pooling of ensembles. Detailed nonparametric hypothesis tests comparing the performance of seven multimodels with two individual models show that the reduced RPS from multimodel forecasts developed using the proposed algorithm is statistically significant from the RPSs of individual models and from the RPSs of existing multimodel techniques. The study also shows that adding climatological ensembles improves the multimodel performance resulting in reduced average RPS. Contingency analyses on categorical (tercile) forecasts show that the proposed multimodel combination technique reduces average Brier score and total number of false alarms, resulting in improved reliability of forecasts. However, adding multiple models with climatology also increases the number of missed targets (in comparison to individual models' forecasts) which primarily results from the reduction of increased resolution that is exhibited in the individual models' forecasts under various forecast probabilities.