A stochastic model that relates synoptic atmospheric data to daily precipit
ation at a network of gages is presented. The model extends the nonhomogene
ous hidden Markov model (NHMM) of Hughes et al, by incorporating precipitat
ion amounts. The NHMM assumes that multisite, daily precipitation occurrenc
e patterns are driven by a finite number of unobserved weather states that
evolve temporally according to a first-order Markov chain. The state transi
tion probabilities are a function of observed or modeled synoptic scale atm
ospheric variables such as mean sea level pressure. For each weather state
we evaluate the joint distribution of daily precipitation amounts at n site
s through the specification of n conditional distributions. The conditional
distributions consist of regressions of transformed amounts at a given sit
e on precipitation occurrence at neighboring sites within a set radius. Res
ults for a network of 30 daily precipitation gages and historical atmospher
ic circulation data in southwestern Australia indicate that the extended NH
MM accurately simulates the wet-day probabilities, survival curves for dry-
and wet-spell lengths, daily precipitation amount distributions at each si
te, and intersite correlations for daily precipitation amounts over the 15
year period from 1978 to 1992.