The declaration also means farmers will receive aid and more firefighters will be employed.
Jerry Brown faced pressure to declare the drought as the state’s largest reservoirs are at record low levels.
The dry conditions have been blamed for a wildfire that destroyed five homes north-east of Los Angeles on Thursday.
In a press conference on Friday, Jerry Brown called on residents to cut back “at least 20%” on their water usage but said the move was voluntary.
“We can’t make it rain, but we can be much better prepared for the terrible consequences that California’s drought now threatens,” Jerry Brown said in a statement.
He added the declaration was a way to focus Californians on how serious the drought conditions were.
“We are in an unprecedented, very serious situation that people should pause and reflect on how dependent we are on the rain, nature and one other,” he said on CNN.
Previous extremely dry years led to catastrophic wildfire seasons in California in 2003 and 2007.
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