Abstract The cumulative effects of daily herbage allowance (DHA) restriction on pasture characteristics and the sustainability of pasture-based dairy systems were evaluated. Sixty-four dairy cows were randomly assigned to one of two grazing treatments (20 and 30 kg DM cow-1 day-1). Milk yield and pre- and post-grazing herbage mass were recorded for every grazing event. Botanical and chemical compositions of the pasture were evaluated. Low DHA increased the stocking rate by 0.7 cows ha-1 and consequently increased grazing efficiency from 41 to 47%. Daily herbage allowance restriction did not affect pasture characteristics or milk production per cow, but DHA restriction increased milk production per hectare (+27%). The results suggest that restriction on daily herbage allowance ensures a higher level of herbage utilization and milk output per ha than high DHA, without affecting pasture characteristics. Therefore, DHA might be a useful grazing management tool for improving the profitability and sustainability of grazing-based dairy systems.