Water availability is a key determinant of terrestrial plant productivity. Many climate models predict that water stress will increasingly challenge agricultural yields and exacerbate projected food deficits. To ensure food security and increase agricultural efficiency, crop water productivity must be increased. Research over past decades has established that the phytohormone abscisic acid (ABA) is a central regulator of water use and directly regulates stomatal opening and transpiration. In this study, we investigated whether the water productivity of wheat could be improved by increasing its ABA sensitivity. We show that overexpression of a wheat ABA receptor increases wheat ABA sensitivity, which significantly lowers a plant's lifetime water consumption. Physiological analyses demonstrated that this water-saving trait is a consequence of reduced transpiration and a concomitant increase in photosynthetic activity, which together boost grain production per litre of water and protect productivity during water deficit. Our findings provide a general strategy for increasing water productivity that should be applicable to other crops because of the high conservation of the ABA signalling pathway.