If the input voltage is lower than the set MID_OUT voltage plus the specified V_{DO(MID_OUT)} dropout voltage, but all other conditions are met for normal operation, the device operates in V_{MID_OUT} dropout mode. When the device operates in this mode while V_{MID_OUT} voltage is still higher than V_OUT(nom) + V_DO(OUT), then V_OUT is still in regulation however V_{MID_OUT} voltage is in its dropout mode. In V_{MID_OUT} dropout mode, V_{MID_OUT} voltage tracks the input voltage and during this mode, the transient performance of V_{MID_OUT} voltage becomes significantly degraded because the MID_OUT pass transistor is in the ohmic or triode region, and acts as a switch. Also V_{MID_OUT} line or load transients can result in large V_{MID_OUT} voltage deviations.

The device enters V_DO(OUT) dropout mode when the input voltage is lower than the set MID_OUT voltage and V_{MID_OUT} is lower than V_{OUT(nom) + VDO(OUT)}. In V_OUT dropout mode, V_OUT voltage tracks V_{MID_OUT} voltage which in return tracks the input voltage. During this mode, the transient performance of both V_{MID_OUT} and V_OUT voltages becomes significantly degraded because the pass transistors are in the ohmic or triode region and acting as switches. Also line or load transients can result in large V_{MID_OUT} and V_OUT voltages deviations.

When the device is in a steady dropout state (defined as when the device is in dropout, V_IN < V_OUT(NOM) + V_DO, directly after being in a 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 period of time while the device pulls the pass transistor back into the linear region.