AbstractClimate change is expected to increase the frequency and severity of droughts. These events, which can cause significant perturbations of terrestrial ecosystems and potentially long‐term impacts on ecosystem structure and functioning after the drought has subsided are often called ‘drought legacies’. While the immediate effects of drought on ecosystems have been comparatively well characterized, our broader understanding of drought legacies is just emerging. Drought legacies can relate to all aspects of ecosystem structure and functioning, involving changes at the species and the community scale as well as alterations of soil properties. This has consequences for ecosystem responses to subsequent drought. Here, we synthesize current knowledge on drought legacies and the underlying mechanisms. We highlight the relevance of legacy duration to different ecosystem processes using examples of carbon cycling and community composition. We present hypotheses characterizing how intrinsic (i.e. biotic and abiotic properties and processes) and extrinsic (i.e. drought timing, severity, and frequency) factors could alter resilience trajectories under scenarios of recurrent drought events. We propose ways for improving our understanding of drought legacies and their implications for subsequent drought events, needed to assess the longer‐term consequences of droughts on ecosystem structure and functioning.