Sheep production on the Mediterranean dry climate lands of Chile is characterized by its seasonality and extensive production system, with low use of purchased external productive inputs. The prevailing market conditions have determined an increasing tendency towards the use of specialized meat breeds. The production systems are strongly influenced by agroclimatic characteristics and by continuous need of management and profitability improvement. A simulation model was developed to assist decision-making be used as a tool for supporting management decision-making that and to allows the evaluation of different production alternatives. The model considers three components: i) soil water balance, considering the water available to be used by herbaceous strata in the first 40 cm of soil; ii) grassland’s growth and senescence, where the potential and real growth of the herbaceous strata is determined by the effect of climatic variables, availability of photosynthetic materials and soil humidity; and iii) animal intake and live weight changes, which determines the real dry matter intake with or without the use of supplements and its relation to lamb’s live weight changes. The interrelation between animal performance and forage growth was built taking into account the effect of grazing and animal stocking rate over forage growth. The model was validated comparing data obtained by simulation with experimental data, achieving a good prediction (p < 0.05).