Dry matter (DM) yields of unimproved resident browntop-dominant pasture on three Central Otago dryland farms was <1.5 t /ha/year from 2008-2010. An intensive pasture renewal programme over >18 000 ha applied lime to increase soil pH to ≥5.8 and reduce aluminium to <1.5 mg/kg. The resident vegetation was sprayed in autumn before spring drilling of perennial ryegrass/white clover pastures or lucerne monocultures. After renovation, ryegrass pastures yielded 3.1-5.3 t DM/ha and lucerne produced 4.2-8.4 t DM/ha. Yields of improved pastures were affected by the soil moisture stored during autumn and winter and spring rainfall. Together these gave a water use efficiency of ~16.0 kg DM/ha/mm for lucerne compared with 3.5 kg DM/ha/ mm for browntop dominant pasture. Quantifying and explaining yield improvements on-farm in relation to rainfall and soil moisture deficits provide a transferable basis for interpretation of results at other sites.