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Climate-change assessments project increasing precipitation variability through increased frequency of extreme events. However, the effects of interannual precipitation variance per se on ecosystem functioning have been largely understudied. Here, we report on the effects of interannual precipitation variability on the primary production of global drylands, which include deserts, steppes, shrublands, grasslands, and prairies and cover about 40% of the terrestrial earth surface. We used a global database that has 43 datasets, which are uniformly distributed in parameter space and each has at least 10 years of data. We found (a) that at the global scale, precipitation variability has a negative effect on aboveground net primary production. (b) Expected increases in interannual precipitation variability for the year 2,100 may result in a decrease of up to 12% of the global terrestrial carbon sink. (c) The effect of precipitation interannual variability on dryland productivity changes from positive to negative along a precipitation gradient. Arid sites with mean precipitation under 300 mm/year responded positively to increases in precipitation variability, whereas sites with mean precipitation over 300 mm/year responded negatively. We propose three complementary mechanisms to explain this result: (a) concave-up and concave-down precipitation-production relationships in arid vs. humid systems, (b) shift in the distribution of water in the soil profile, and (c) altered frequency of positive and negative legacies. Our results demonstrated that enhanced precipitation variability will have direct impacts on global drylands that can potentially affect the future terrestrial carbon sink.