In urban areas, hydrological processes are characterized by high variability in space and time, making them sensitive to small-scale temporal and spatial rainfall variability. In the last decades new instruments, techniques, and methods have been developed to capture rainfall and hydrological processes at high resolution. Weather radars have been introduced to estimate high spatial and temporal rainfall variability. At the same time, new models have been proposed to reproduce hydrological response, based on small-scale representation of urban catchment spatial variability. Despite these efforts, interactions between rainfall variability, catchment heterogeneity, and hydrological response remain poorly understood. This paper presents a review of our current understanding of hydrological processes in urban environments as reported in the literature, focusing on their spatial and temporal variability aspects. We review recent findings on the effects of rainfall variability on hydrological response and identify gaps where knowledge needs to be further developed to improve our understanding of and capability to predict urban hydrological response.