The time series of drought and flood indices in the Three Gorges area are constructed according to Zindex system and the multiple time scales variation characteristics of the index series are analyzed by using Morlet wavelet transform method. The atmospheric circulation characteristics in the typical summer drought/flood years are investigated. It is found that the drought/flood variation is characterized by obvious interannual and interdecadal changes in the Three Gorges area. The drought index and the flood index time series have almost antiphase variations on the annual and seasonal time scales. The Morlet wavelet analyses show that the drought and flood indices in the Three Gorges Reservoir area have remarkable periodic oscillation and obvious local features in different time and frequency distributions. There are quasi5-year, quasi9-year， and quasi15-year interdecadal periodical oscillations. The periodical oscillations of the drought and flood features have significant seasonal differences. In flood years, the atmospheric circulation background in the Three Gorges Reservoir area shows that the anomaly of 500hPa geopotential height field is positive in the Ural Mountains, Siberia, and Lake Balkash, and negative in the Loop area and North China Plain as far as the Sea of Japan. The atmospheric circulation anomaly is opposite in drought years.