Livestock productivity of semiarid, native grassland is potentially enhanced by interseeding alfalfa (Medicago sativa L.), but little is known of the impact on forage and N yield and water use. Two hay-type cultivars, ‘WL 440HQ’ (WL), ‘NuMex Bill Melton’ (NuMex), and grazing-type ‘Falcata’–‘Rhizoma’ blend (FR) were interseeded into mixtures of four native-grass species in fall of 2015, at 36- and 71-cm row spacing as high- and low-density plantings, respectively. Plots were harvested periodically over 3 yr. Evapotranspiration (ET) was estimated based on rainfall and changes in soil water volume and used to calculate water use efficiency (WUE, kg of forage mass m−3 of ET). Alfalfa–grass mixtures produced 35% more forage mass and 96% greater N yield than the grass-only stands. Narrow-row alfalfa produced greater total forage mass than wide-row for the first 2 yr (P <.05), but no difference between row spacings occurred by Year 3. Cultivars NuMex and WL produced greater forage mass than the short-statured FR, especially at high density (P <.05). Alfalfa–grass mixtures increased WUE by a mean of 25% over the grass-only stands. There was no difference between row spacings for WUE, weed biomass, and weed N mass (P >.05). The alfalfa–grass mixtures reduced weed biomass by 43% over the grass-only stands. Interseeding alfalfa at wide row spacing enhanced forage productivity, WUE, and weed suppression relative to grass-only stands at lower seed cost than at narrow row spacing. Adapted hay-type alfalfa cultivars can be used to improve native-grass pastures in rainfed, semiarid environments.