Evapotranspiration is a key parameter for water stress assessment as it is directly related to the moisture status of the soil-vegetation system and describes the moisture transfer from the surface to the atmosphere. With the launch of the Meteosat Second Generation geostationary satellites and the setup of the Satellite Application Facilities, it became possible to operationally produce evapotranspiration data with high spatial and temporal evolution over the entire continents of Europe and Africa. In the frame of this study we present an evaluation of the potential of the evapotranspiration (ET) product from the EUMETSAT Satellite Application Facility on Land Surface Analysis (LSA-SAF) for drought assessment and monitoring in Europe. To assess the potential of this product, the LSA-SAF ET was used as input for the ratio of ET to reference evapotranspiration (ET0), the latter estimated from the ECMWF interim reanalysis. In the analysis two case studies were considered corresponding to the drought episodes of spring/summer 2007 and 2011. For these case studies, the ratio ET/ET0 was compared with meteorological drought indices (SPI, SPEI and Sc-PDSI for 2007 and SPI for 2011) as well as with the anomalies of the fraction of absorbed photosynthetic active radiation (fAPAR) derived from remote sensing data. The meteorological and remote sensing indicators were taken from the European Drought Observatory (EDO) and the CARPATCLIM climatological atlas. Results show the potential of ET/ET0 to characterize soil moisture variability, and to give additional information to fAPAR and to precipitation distribution for drought assessment. The main limitations of the proposed ratio for drought characterization are discussed, including options to overcome them. These options include the use of filters to discriminate areas with a low percentage vegetation cover or areas that are not in their growing period and the use of evapotranspiration without water restriction (ETwwr), obtained as output of the LSA-SAF model instead of ET0. The ET/ ETwwr ratio was tested by comparing its accumulated values per growing period with the winter wheat yield values per country published by Eurostat. The results point to the potential of using the remote sensing based LSA-SAF evapotranspiration and the ET/ ETwwr ratio for vegetation monitoring at large scale, especially in areas where data is generally lacking.