Drought and extreme temperatures forecasting is important for water management and the prevention of health risks, especially in a period of observed climatic change. A large precipitation deficit together with increased evapotranspiration rates in the preceding days contribute to exceptionally high temperature anomalies in the summer above the average local maximum temperature for each month. Using a retrospective approach, this study investigated droughts and extreme temperatures in the greater area of Nicosia, Cyprus and suggests a different approach in determining the lag period of summer temperature anomalies and precipitation. In addition, dry conditions defined with the use of the Standardized Precipitation-Evapotranspiration Index (SPEI) were associated with positive temperature anomalies at a percentage up to 33.7%. The compound effect of precipitation levels and evapotranspiration rates of the preceding days for the period 1988–2017 to summer temperature anomalies was demonstrated with significantly statistical R squared values up to 0.57. Furthermore, the cooling effect of precipitation was higher and prolonged longer in rural and suburban than urban areas, a fact that is directly related to the evaporation potential of the area in concern. Our work demonstrates the compound effect of precipitation levels and evapotranspiration rates of the preceding days to summer temperature anomalies.