Yorkshire Water will bring in a hosepipe ban for the first time in 27 years, affecting five million customers.
The ban comes into force once August 26 and those caught flouting it face fines of up to £1,000.
Yorkshire Water said its reservoir levels have fallen below 50 per cent for the first time since the drought of 1995.
It adds that it will take months of rainfall to replenish..
Yorkshire Water's director of water Neil Dewis said "Parts of Yorkshire have seen the lowest rainfall since our records began more than 130 years ago.
"The hot, dry, weather means that Yorkshire's rivers are running low and our reservoirs are around 20% lower than we would expect for this time of year. We've been doing everything we can to avoid putting in restrictions but, unfortunately, they're now necessary as part of our drought planning.
"We've been monitoring reservoir levels, weather forecasts and other environmental indicators closely to determine whether we might need to put further measures in place.
"As we've now reached that trigger point, we need to make sure that we have enough supply for the essential needs of people across the region this year and next, as well as making sure we're able to protect our local environment by limiting the amount of water we have to draw from the rivers.
"Our decision to introduce a hosepipe ban is based on the risk that water stocks continue to fall in the coming weeks and the need to be cautious about clean water supplies and long-term river health."
Under the restrictions, customers are banned from using a hosepipe to water their gardens, clean their vehicles, fill their swimming pools or clean their homes.
However, they are still permitted to complete those activities with tap water from a bucket or watering can, or using water that is not sourced from taps.
Businesses will only be allowed to use a hosepipe if it is directly related to a commercial purpose.
It comes as Thames Water, Welsh Water (Dwr Cymru), Southern Water and South East Water all previously signalled hosepipe bans would be necessary while the Wildlife Trusts have called for an England-wide hosepipe ban to protect nature and rivers.
Earlier this week, Thames Water was set to announce a temporary hosepipe ban "in the coming weeks" due to the long-term forecast of dry weather.
Using hosepipes has already been banned by two water companies while others have warned they may need to follow suit.
It follows the driest eight months from November to June since 1976 and the most sun-baked July on record for parts of eastern and southern England.
Southern Water has introduced a ban in the Isle of Wight and Hampshire and is asking the Environment Agency for a special permit to allow it to take more water from the River Test, according to The Times.
Today, a hosepipe ban came into force in Kent and Sussex as South East Water said it had been "left with no choice but to restrict the use of hosepipes and sprinklers" - from midnight on August 12 “until further notice".
It comes as a drought is set to be declared for some parts of England today as temperatures are expected to top 35C making the country hotter than parts of the Caribbean.
Britons have been warned of the health impacts of extreme heat and the risk of wildfires amid a heatwave blasting the nation.
The National Drought Group, made up of Government and agency officials, water companies and other groups such as the National Farmers' Union (NFU), is set to meet on Friday to discuss the prolonged dry weather.
There are expectations drought could be declared for the most affected areas of England in the south and east, after the driest July on record for some areas and the driest first half of the year since 1976.
Parts of the UK will be hotter than the Bahamas, Jamaica and Barbados today.
A four-day amber warning for extreme heat from the Met Office is in place for much of England and Wales until Sunday, with warnings of health impacts and disruption to travel.
Forecaster Craig Snell told the PA news agency: "It's going to be an incredibly hot day, and very sunny across the board, with temperatures slightly higher than what we saw on Thursday."
There is also a heat health alert in place from the UK Health Security Agency, with experts advising people to look out for those who are older or with existing health conditions, as well as young children.
The ongoing dry conditions, combined with last month's record-breaking heatwave, have depleted rivers, reservoirs and aquifers and dried up soils, hitting agriculture, water supplies and wildlife and raising the risk of wildfires.
Some water companies have failed to meet their own targets for cutting household leaks and domestic use, with many blaming the coronavirus pandemic as more people have been at home.
Ofwat, the water regulator. said in a statement: "Progress has been made in the past few years but there is much further to go, which is why we are pushing companies to reduce leakage, fix their environmental performance and become more financially resilient while keeping bills affordable and helping customers reduce their consumption.
"Where we find that companies have fallen short, we will act - over the last five years, for example, we have imposed penalties and payments of over £250 million."
