If the input voltage is lower than the nominal output voltage plus the specified dropout voltage, but all other conditions are met for normal operation, the device operates in dropout mode. Similarly, if the bias voltage is lower than the nominal output voltage plus the specified dropout voltage, but all other conditions are met for normal operation, the device operates in dropout mode as well. In this mode, the output voltage tracks the input voltage. During this mode, the transient performance of the device becomes significantly degraded because the pass transistor is in the ohmic or triode region, and acts as a switch. Line or load transients in dropout can result in large output voltage deviations.

When the device is in a steady dropout state, defined as when the device is in dropout, (V_IN < V_OUT + V_DO or V_BIAS < V_OUT + V_DO directly after being in normal regulation state, but not during start up), the pass transistor is driven into the ohmic or triode region. When the input voltage returns to a value greater than or equal to the nominal output voltage plus the dropout voltage (V_OUT(NOM) + V_DO), the output voltage can overshoot for a short time when the device pulls the pass transistor back into the linear region.