Dryland cereal production systems of south-eastern Australia require viable options for reducing nitrous oxide (N2O) emissions without compromising productivity and profitability. A 4-year rotational experiment with wheat (Triticum aestivum L.)–canola (Brassica napus L.)–grain legumes–wheat in sequence was established at Wagga Wagga, NSW, Australia, in a semiarid Mediterranean-type environment where long-term average annual rainfall is 541 mm and the incidence of summer rainfall is episodic and unreliable. The objectives of the experiment were to investigate whether (i) tillage increases N2O emissions and (ii) nitrogen (N) application can improve productivity without increasing N2O emissions. The base experimental design for each crop phase was a split-plot design with tillage treatment (tilled versus no-till) as the whole plot, and N fertiliser rate (0, 25, 50 and 100 kg N/ha) as the subplot, replicated three times. This paper reports high resolution N2O emission data under a canola crop. The daily N2O emission rate averaged 0.55 g N2O-N/ha.day, ranging between –0.81 and 6.71 g N2O-N/ha.day. The annual cumulative N2O-N emitted was 175.6 and 224.3 g N2O-N/ha under 0 and 100 kg N/ha treatments respectively. There was no evidence to support the first hypothesis that tillage increases N2O emissions, a result which may give farmers more confidence to use tillage strategically to manage weeds and diseases where necessary. However, increasing N fertiliser rate tended to increase N2O emissions, but did not increase crop production at this site.