The increasing scarcity of irrigation water necessitates the development of water-saving technology in rice production. Our previous studies have shown that “safe” alternate wetting and drying irrigation (AWD15) can effectively save water, improve water productivity while maintain grain yield compared to continuous flooding (CF) and farmer's water management practice (FP) under a single fertilizer-N input. The objectives of this study are (1) to investigate the superiority of this novel water management practice compared with FP; and (2) to examine whether there is an interaction between water and N input and whether fertilizer-N input needs to be adjusted under AWD15. Two field experiments were conducted during the late cropping seasons of 2014 and 2015. A hybrid rice variety Tianyou3618 was grown under two water management (AWD15 and FP) and four fertilizer-N rates (0, 90, 180, 270kgNha−1). Grain yield, water productivity and nitrogen use efficiency were determined. Compared to that of FP, irrigation water input of AWD15 was reduced by 24.1% in 2014 and 71.4% in 2015. The number of irrigations decreased and water productivity increased significantly. No significant differences existed between AWD15 and FP in grain yield, biomass, leaf area index and nitrogen use efficiency. Nitrogen input level had significant effects on yield, biomass, harvest index and nitrogen use efficiency in both years. Grain yield increased with N rate and the optimal N rate was 180kgNha−1. No significant interaction was found between water and nitrogen rate regarding biomass production and grain yield. Our results demonstrated that no change in N input is needed under AWD15 condition and AWD15 is advantageous over farmer's water management practice under all N levels investigated in South China. This is the first report on the performance of AWD15 under different fertilizer-N levels in South China.