Extreme droughts of increased frequency due to climate change poses great challenges to the sustainability of plantations in drylands worldwide. Millions of plantations on China’s Loess Plateau which are mainly in drylands are threatened by serious degradation due to water scarcity. Here we aim to disentangle the impacts of combinations of terracing and mulching on water use strategy and its response to extreme droughts in a rainfed jujube (Ziziphus jujuba) plantation on the semiarid Loess Plateau, using three-year in situ field observations. Pruned jujube branches and maize straw were mulched on half-moon terraces to form two combined treatments, referred to as JBT and MST, respectively. The efficacy of these two combinations on the water use strategy of jujube trees was compared with terracing alone (SHT) and control (no terrace). We found that extreme drought clearly reduced soil water storage (SWS) under all treatments. However, the combined treatments showed significantly (P<0.05) higher SWS than the SHT and control. Furthermore, the combined treatments enhanced soil water use in deep layers during both normal and drought years, thus helping jujube trees to resist droughts. Moreover, the extreme drought significantly reduced transpiration whereas the moderate drought increased transpiration at both seasonal and annual scales. Nonetheless, the combined treatments were associated with enhanced transpiration compared to the SHT and control during drought periods. Finally, jujube trees exhibited isohydric behavior which also helped them to cope with prolonged droughts. Overall, the findings here may provide insights into land management of dryland plantations worldwide under climate change.