The dry matter (DM) yield, cellulase DM disappearance (CDMD) and herbage nitrogen (N) of sheep-grazed perennial ryegrass [Lolium perenne(L.)] during its establishment year was evaluated. Yield and quality were monitored under N applications ranging from 120 to 720 kg N ha−1a−1. Total (perennial ryegrass and weeds) and perennial ryegrass DM yields increased with increasing levels of N up to 480 kg ha−1a−1. Conversely, weed DM yields declined with increasing N up to 480 kg ha−1a−1. A logistic model predicting the response of perennial ryegrass DM yield to applied N also indicated little justification for applying N in excess of 500 kg ha−1a−1. Although CDMD and herbage N increased throughout the range of N applied, such increase was significant (P<0.05) only up to 480 kg ha−1a−1. In terms of yield and quality, there is little justification for applying N in excess of 480 kg ha−1a−1to perennial ryegrass during its establishment year.