To take advantage of recent development in the NCAR/Penn State Mesoscale Model (MM5), an effort has been organized to develop and evaluate an MM5-based community regional climate model. Several modifications such as the implementation of the PNNL subgrid parameterization of orographic precipitation, representation of cloud-radiation interaction, and additional output capabilities have been made to the recently released MM5 Version 3.4. To evaluate the model, several long-term simulations have been performed over the western U.S. These simulations were driven by the NCEP/NCAR and ECMWF reanalyses respectively for 20 and 13 years beginning at 1980. The western U.S. is marked by diverse topographic features and varied climate conditions such as the maritime climate in the coastal area and the semi-arid climate in the southwest. We will present results based on two domain configurations: a nested domain with a fine domain covering the western U.S. at 40 km resolution, and a single domain at 60 km resolution with the subgrid orographic precipitation scheme applied in the western U.S. Analyses are being performed to evaluate the simulations of the averaged climate and interannual variability and examine the model sensitivity to different boundary conditions. Our analyses focus on the relationships between large-scale circulation and regional climate features, surface energy and water budgets, orographic precipitation, and hydrologic conditions within selected river basins. Regional simulations are also being performed using large-scale conditions simulated by the NCAR/DOE Parallel Climate Model (PCM) and results will be compared with those driven by the reanalyses.