Projected global change will increase the level of land-use and environmental stressors such as drought and grazing, particularly in drylands. Still, combined effects of drought and grazing on plant production are poorly understood, thus hampering adequate projections and development of mitigation strategies. We used a large, cross-continental database consisting of 174 long-term datasets from >30 dryland regions to quantify ecosystem responses to drought and grazing with the ultimate goal to increase functional understanding in these responses. Two key aspects of ecosystem stability, resistance to and recovery after a drought, were evaluated based on standardized and normalized aboveground net primary production (ANPP) data. Drought intensity was quantified using the standardized precipitation index. We tested effects of drought intensity, grazing regime (grazed, ungrazed), biome (grassland, shrubland, savanna) or dominant life history (annual, perennial) of the herbaceous layer to assess the relative importance of these factors for ecosystem stability, and to identify predictable relationships between drought intensity and ecosystem resistance and recovery. We found that both components of ecosystem stability were better explained by dominant herbaceous life history than by biome. Increasing drought intensity (quasi-) linearly reduced ecosystem resistance. Even though annual and perennial systems showed the same response rate to increasing drought intensity, they differed in their general magnitude of resistance, with annual systems being ca. 27% less resistant. In contrast, systems with an herbaceous layer dominated by annuals had substantially higher postdrought recovery, particularly when grazed. Combined effects of drought and grazing were not merely additive but modulated by dominant life history of the herbaceous layer. To the best of our knowledge, our study established the first predictive, cross-continental model between drought intensity and drought-related relative losses in ANPP, and suggests that systems with an herbaceous layer dominated by annuals are more prone to ecosystem degradation under future global change regimes.