Overgrazing by livestock and the changing patterns of rainfall, characterized by severe drought and floods during dry and wet seasons, respectively, threaten the sustainable productivity of the savannas. To understand the implications of such changes in Lambwe Valley—Kenya, we simulated 50% decrease (50%) and increase (150%) in ambient rainfall (100%), respectively, in grazed (G) and ungrazed (U) sites during dry and wet months. CO₂ exchange and biomass production were quantified using chamber method and direct biomass sampling technique, respectively. Plots were named by combining the first letters of the sites followed by rainfall amount, i.e., U150%. Soil moisture (VWC) increased along a rainfall gradient of 50–150%. Grazing reduced the VWC, net ecosystem exchange (NEE), and total biomass by 19.07%, 57.14%, and 37.03%, respectively, with severe effects during the dry months. 50% rainfall strongly influenced the VWC, NEE (negative and positive signs indicate CO₂ uptake and net carbon loss, respectively), and biomass compared to 150% rainfall. The U150% plot reported the highest mean NEE (– 8.80 ± 2.26 µmol m⁻² s⁻¹), AGB (1208.41 g m⁻²), and total biomass (1589.06 g m⁻²) during the wet months. Lower VWC in the G50% plot triggered a net carbon loss of 3.68 ± 0.81 µmol m⁻² s⁻¹ (NEE). Our results show that livestock grazing during the dry months hinders herbaceous CO₂ uptake and standing biomass. Proper understanding of the interaction between livestock grazing and rainfall variability in humid savannas is essential for sustainable management strategies to regulate the herbaceous productivity.