Abstract: The design of many water resources projects requires knowledge of possible long-term rainfall patterns. In this project a stochastic model based on a first order Markov chain was developed to simulate daily rainfall at a point. The model is applicable to any point in Kentucky (and other areas with similar rainfall patterns). The model in its present form is useful in providing rainfall inputs into hydrologic models for designing water supply facilities and other water resources systems. The model uses historical rainfall data to estimate the Markov transitional probabilities. A separate matrix is estimated for each month of the year. In this report 7 X 7 transitional probability matrices were used. The model is capable of simulating a daily rainfall record of any length based on the estimated transitional probabilities and frequency distributions of rainfall amounts within each class interval. The simulated data has statistical properties similar to historical data. Funding information: The project was supported in part by funds provided by the United States Department of Interior to the University of Kentucky Water Resources Institute as authorized by the Water Resources Act of 1964, Public Law 88-379, as Office of Water Resources Research Project No. A-045-KY. Partial funding was also provided by the Kentucky Agricultural Experiment Station as a contribution to Southern Regional Research Project S-53 "Factors Affecting Water Yields from Small Watersheds and Shallow Ground Aquifers".