This thesis evaluates TRMM satellite precipitation data over Nepal and its application in hydrologic modeling of the Narayani River Basin. Statistical comparisons of TRMM and gauge data from 2001-2008 show TRMM generally underestimates precipitation. The PINEHBV hydrologic model is set up and calibrated for the basin using TRMM data from 2004-2008, and validated for 2009-2010. The model simulation results are acceptable but could be improved by addressing TRMM underestimation biases and moving to a monthly or distributed model setup.