The Kraai River has its origins at the southernmost end of the Drakensberg, south of the Kingdom of Lesotho, in the magisterial district of Barkly East. The Kraai is a tributary of the Orange River and flows westwards from the junction of the Bell River and the Sterkspruit at Moshesh's Ford to join the Orange near Aliwal North. The Orange flows into the Atlantic at Oranjemund. The Kraai catchment starts at altitudes of up to 3000 m on the basaltic rocks of the watershed that forms the boundary between South Africa, Lesotho and the Herschel District of the former Republic of Transkei. North of this watershed, in Lesotho and the Herschel district, the Sebepala and Telle Rivers and their tributaries drain into the Orange, which is called the Senqu in Lesotho.

A westerly ridge of the Drakensberg is called the Witteberg west of Lundean's Nek. This beautiful ridge forms a continuation of the Upper and Middle Kraai- Orange watershed. The ridge ends in the vicinity of Lady Grey. The watershed along the easterly boundary of the Kraai catchment, along the escarpment above the districts of Maclear, Ugie and Elliot, separates flow between the Atlantic Ocean via the Orange and the Indian Ocean via the Umzimvubu. The latter river enters the sea at Port St John's.

The Upper Kraai catchment lies between Moshesh's Ford and the sources of the streams that drain into the Kraai at the Ford. The Middle Kraai extends from Moshesh's Ford to the confluence of the Kraai and the Karringmelkspruit. Below that confluence lies the Lower Kraai. The Kraai, like the lower reaches of its main tributaries, flows almost entirely over sandstone rocks of the Clarens Formation that underlie the higher altitude basalts and other volcanic rocks of the Drakensberg Group. On the Upper Kraai catchment the Bell River and the Sterkspruit have many tributaries. The Bell rises on the farm Tena Head, near the border with Lesotho. A tributary of the Bell, the Kloppershoekspruit, originates on the slopes of Ben Macdhui, which is the highest peak in the former Colony of the Cape of Good Hope (3001 m). Less well-known but occasionally fishable streams are the Carlisleshoek- and the Maartenshoekspruits. The Sterkspruit rises near Barkly Pass and the Bastervoetpad. The major tributaries of this stream are the Bok- and Riflespruits, the upper reaches of which flow through spectacular and mainly gravel-floored trough-like valleys. A lesser-known tributary that also flows through spectacular scenery, especially near the farm of Knighton, is the Coldstream.

Downstream of Moshesh's Ford, on the farm of Eagle's Craig, the Kraai is joined by the Joggemspruit. This stream rises near Lundean's Nek. Tributaries of the Joggemspruit include the Funnystone Stream, rising near the western slopes of Ben Macdhui, and the Vlooikraalspruit, which is home of the Balloch Trout Hatchery. The Joggemspruit drains the Wartrail region of Barkly district. The Langkloofspruit, which rises near the Barkly Pass, is well known partly because the tarred road follows its valley between Elliot and Barkly East and partly because of the fascinating human history of the valley, which was inhabited by hunter-gatherers until about 1870.This Spruit enters the Kraai a short distance upstream of magnificent sandstone-built Loch Bridge. This bridge, which was built in 1893, is now a National Monument.

The New England area, north of Barkly East, is drained by the Diepspruit, (to which the Three Drifts Stream is tributary), and the Klein Wildebeestspruit. The Saalboomspruit and its tributary, the Vaalhoekspruit, run through the area around the tiny settlement of Rossouw and drain the uplands south west of Barkly, from the summit of the Otto du Plessis Pass, northwards. The Saalboom enters the Kraai immediately upstream of the modern bridge at the bottom of the Kraai River Pass. Further downstream the descriptively named Karringmelkspruit enters the Kraai downstream of the Karringmelkspruit Pass and the adjacent railway "reverses". Comparable "reverses" exist immediately downstream of Loch Bridge.

Rivers originating on the escarpment are due to runoff from essentially convectional, adiabatic and winter frontal precipitation as well as melt-water from occasional snowfalls. Much of the convectional rain falls in summer and is associated with the incursion of Indian Ocean high pressure into the interior of eastern southern Africa. This allows moist tropical air to flow south into the Drakensberg, where summer thunderstorms are common. Adiabatic rainfall is particularly associated with the ridging of high pressure onto the region between the Transkei coast and the mountains, which allows moist air to pile-up against or even over-top the escarpment, resulting in precipitation. Frontal rain (and sometimes snow-fall) is associated mainly with the winter movement of fronts eastwards from the Atlantic and towards the Indian Ocean.