Drought comprehensively affects different interlinked aspects of the terrestrial water cycle, which have so far been mostly investigated without direct comparison. Resolving the partitioning of water deficit during drought into blue-water runoff and green-water evapotranspiration fluxes is critical, as anomalies in these fluxes threaten different associated societal sectors and ecosystems. Here, we analyze the propagation of drought-inducing precipitation deficits through soil moisture reductions to their impacts on blue and green-water fluxes by use of comprehensive multi-decadal data from > 400 near-natural catchments along a steep climate gradient across Europe. We show that soil-moisture drought reduces runoff stronger and faster than it reduces evapotranspiration over the entire continent. While runoff responds within weeks, evapotranspiration can be unaffected for months. Understanding these drought-impact pathways across blue and green-water fluxes and geospheres is essential for ensuring food and water security, and developing early-warning and adaptation systems in support of society and ecosystems.