Since the past three decades a great deal of effort is devoted to development of satellite-based precipitation retrieval algorithms. More recently, several satellite-based precipitation products have emerged that provide uninterrupted precipitation time series with quasi-global coverage. These satellite-based precipitation products provide an unprecedented opportunity for hydrometeorological applications and climate studies. Although growing, the application of satellite data for hydrological applications is still very limited. In this study, the effectiveness of using satellite-based precipitation products for streamflow simulation at catchment scale is evaluated. Five satellite-based precipitation products (TMPA-RT, TMPA-V6, CMORPH, PERSIANN, and PERSIANN-adj) are used as forcing data for streamflow simulations at 6-h and monthly time scales during the period of 2003-2008. SACramento Soil Moisture Accounting (SAC-SMA) model is used for streamflow simulation over the mid-size Illinois River basin.The results show that by employing the satellite-based precipitation forcing the general streamflow pattern is well captured at both 6-h and monthly time scales. However, satellites products, with no bias-adjustment being employed, significantly overestimate both precipitation inputs and simulated streamflows over warm months (spring and summer months). For cold season, on the other hand, the unadjusted precipitation products result in under-estimation of streamflow forecast. It was found that bias-adjustment of precipitation is critical and can yield to substantial improvement in capturing both streamflow pattern and magnitude. The results suggest that along with efforts to improve satellite-based precipitation estimation techniques, it is important to develop more effective near real-time precipitation bias adjustment techniques for hydrologic applications. © 2010 Elsevier B.V.