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Rotations and associated management practices in rainfed farming systems of southwest Australia have shifted towards intensified cropping. Survey data from 184 fields spanning 14 Mha of southwest Australia were used to document water use efficiency (WUE) and water-limited yield potential (WLYP) of commercial crops and crop sequences and identify biophysical variables influencing WUE. WUE achieved in commercial wheat crops was 10.7 kg grain/ha.mm. Using a boundary function Ywl = 25 × (WU − 45), farmers achieved 54% of WLYP. Climate variables affected WUE more than management and biotic variates, the highest latitude region having WUE of 9.0 kg grain/ha.mm, compared to 11.8 kg grain/ha.mm for regions further south. Increased soil nitrogen and nitrogen fertiliser increased WUE, as did sowing earlier; in keeping with farmers in southern Australia sowing crops earlier and trebling fertiliser nitrogen usage since 1990. Wheat yield and WUE increased a small amount after break crop or pasture (12.5 kg grain/ha.mm) compared to wheat grown after wheat (11.2 kg grain/ha.mm), due to good weed and root pathogen control, and high fertiliser nitrogen application. However, WUE of wheat declined to 8.4 kg grain/ha.mm when more than three wheat crops were grown in succession. Farmers continue to improve WUE with increased inputs and new technologies replacing some traditional functions of break crops and pasture. However, break crops and pastures are still required within the rotation to maintain WUE and break effects need to be measured over several years. High water use efficiency was associated with low levels of weed, disease and high fertliser nitrogen inputs in Western Australia's rainfed cropping systems. The yield benefit to wheat sown immediately after break crops or pasture was low, because of low levels of biophysical constraints. However, water use efficiency of wheat declined when three wheat crops were grown in succession. This highlights the need for continued research into the integration of break crops and pastures into wheat dominated rotations. [ABSTRACT FROM AUTHOR]