The drone was spotted around 11 a.m. and deputies are investigating where the drone is being operated, sheriff's Sgt. Chris Clark said.
"Drone operations during a disaster are illegal," Clark said.
VIDEO: How to prepare for a wildfire evacuation
He said the primary concern is to put out the fire and protect people's property.
"That's being hampered by someone flying a drone right now," Clark said.
Cal Fire's latest update on the blaze Wednesday morning is that it has burned 271 acres and is 10 percent contained, according to Division Chief Angela Bernheisel.
In addition to air efforts being grounded, Clark also said police have arrested a man who was allegedly burglarizing a property within the evacuation zone in the 19000 block of Hidden Springs Lane on Tuesday.
PHOTOS: Crews battle wildfire in Santa Cruz Mountains
According to Clark, the suspect had $15,000 in property, mostly jewelry and a bicycle, when he was later located in the city of Santa Cruz and arrested.
The suspect's name has not been released as the sheriff's office completes the investigation, Clark said.
Clark said security patrols have been ongoing through evacuated areas and will continue until evacuation notices are lifted.
Clark advised anyone who notices a person who doesn't appear to belong or has no apparent lawful purpose in an evacuated area to call 911 or the sheriff's office dispatch at (831) 471-1121.
Evacuation info for residents and animals:
Lakeside Elementary: 19621 Black Rd, Los Gatos
Zayante Fire Protection District Station: 7700 E Zayante Rd, Felton
Horses and Goats: Graham Hill Showgrounds: 1145 Graham Hill Rd, Santa Cruz
Small Animals: Santa Cruz County Animal Services: 2200 7th Ave, Santa Cruz