The Climate Hazards group Infrared Precipitation with Stations (CHIRPS) dataset was conceived as a tool for monitoring drought and environmental change over land. Recent validation efforts along South America have assessed its suitability for reproducing the main spatial and temporal features of precipitation. Nevertheless, little has been done regarding the ability of CHIRPS for the assessment of wet and dry conditions, particularly in areas where in situ precipitation records are scarce. In this paper, we investigated the performance of CHIRPS for monitoring wet and dry events along the semiarid Central-Western Argentina. Using the Standardized Precipitation Index (SPI), we compared the CHIRPS database with records from 49 meteorological stations along the study area for the period 1987–2016. Results indicate that the CHIRPS dataset adequately reproduced the temporal variability of SPI on multiple timescales (1 month, 3 months, and 6 months), particularly in the region dominated by warm season precipitation. The large overestimation of the seasonal precipitation in the region dominated by cold season precipitation can introduce errors that are reflected in the performance of CHIRPS over the western portion of the domain. The frequency of wet and dry classes was accurately reproduced by CHIRPS on timescales larger than 1 month (SPI1), given the existence of a wet bias that produces an underestimation of the frequency of zero values. This bias is further translated to the evaluation of the SPI1 during the spatial and temporal assessment of historical dry (1998) and wet (2016) events, especially for the classification of extreme dry/wet months. The results from the evaluation indicate that CHIRPS is a suitable tool for assessing dry and wet conditions for timescales longer than 1 month and can support decision-making process within the hydrometeorological agencies over the region.