BIRMINGHAM — A soggy December has helped much of the South recover from a drought that dried up reservoirs and turned crops and lawns to straw for the last two years, according to a federal report released Thursday.

A year ago, thousands of square miles across the region were considered in “extreme” or “exceptional” drought, the government’s two worst categories.

But the latest U.S. Drought Monitor shows a wet December has helped dramatically, with none of the region currently in the worst category of drought. Towns that were desperate for water last year are OK for now.

Alabama, Florida, Mississippi, Louisiana and Arkansas are completely drought-free, although a pocket of severe to extreme drought persists in the western tip of the Carolinas and northeast Georgia, including a lake vital to the Atlanta area’s water supply.

Eastern Tennessee, most of Kentucky and parts of Virginia and West Virginia remain in at least a moderate drought. Southern Texas is the only area in the nation still plagued by exceptional drought.

Forecasters say conditions began improving in the spring and through the fall as more regular rains helped add moisture to soil and dumped more water into rivers. October was dry, but more regular rainfall has spread across the area since then.

An expert at the University of Alabama in Huntsville said heavy December rains finally stopped the drought in Alabama, but it could take time for the region’s streams and lakes to fully recover.

“Even though we’ve had significant rainfall … I think what we lost in those two years of drought was a lot of the base flow that comes to springs and provides flow to creeks and streams,” said Richard McNider, a professor of atmospheric sciences. “It’s not clear yet whether we have had enough to restore those base flows.”

The end of the drought could have come sooner for Alabama sod farmer Pete Winford, who’s had one problem after another on his 250-acre sod farm.

Weeks without rain forced him to irrigate with water from the Coosa River, but Alabama Power Co. sued him last year, claiming he was hurting hydrodynamic power generation downstream.

Then he said homeowners quit buying sod because of watering restrictions and the recession gutted new home construction. A spike in diesel fuel costs made things even worse.

“You couldn’t have designed a better disaster for a sod farmer,” said Winford, of Harpersville, located about 30 miles southeast of Birmingham. “It was just one thing piled on top of another.”

The drought still stubbornly lingers in the part of Georgia that includes Lake Lanier, metropolitan Atlanta’s main water supply. Water in the huge reservoir is about 19 feet below normal levels, exposing miles of clay lake bed and leaving many docks high and dry.

North Georgia remains under strict restrictions on most outdoor watering, although the rules were relaxed some to allow limited hand-watering several days each week.

State officials say the message of conservation is still resonating. Water use by Georgia’s largest utilities dropped by 7 percent in October — the most recent month the data was collected — compared with the same month last year.

State leaders in North Carolina have stressed a similar message, as Gov. Mike Easley appeared in a $1 million television campaign to urge residents to conserve water.

In October 2007, at the worst of the drought, powerful pumps were floated into the middle of Alabama’s Lake Martin to reach water deep enough to draw for the 60,000 customers of the Alexander City water system.

The town’s spunky 77-year-old mayor, Barbara Young, said the pumps are now in storage. Rather than dealing with a water shortage crisis, she’s signing contracts for fishing tournaments on the lake. Despite the improvement, the city isn’t getting rid of the pumps.