In order to improve the accuracy of rainfall estimates from next generation radar (NEXRAD) uncertainties, data assimilation technique is performed by considering NEXRAD and available rain gauges which can be used to assimilate spatially uniform Multisensor Precipitation Estimator (MPE) scheme and non-uniform (based on rainfall interpolation and bias interpolation) NEXRAD bias estimations during a storm event by Kalman filtering. Even though NEXRAD provides a better spatial representation of rainfall variability than rain gauge information, it suffers from uncertainties and biases due to Z–R (reflectivity–rainfall) conversion method and limitation of available rain gauge information for NEXRAD bias correction in a particular river basin. Analysis of correcting NEXRAD bias rainfall with three different bias correction schemes is described in this study. The prediction accuracy of the STORE DHM (Storage Released based Distributed Hydrologic Model) simulations is also evaluated by using three different NEXRAD bias corrected rainfall inputs. The Upper Wabash River (17,907 km2) and the Upper Cumberland River (38,160 km2) basins are selected as the study areas to evaluate rainfall input sensitivity on different spatial characteristics. Use of spatially non-uniform NEXRAD bias correction schemes results has better rainfall and prediction accuracy compared to that of spatially uniform NEXRAD bias correction rainfall.