AbstractAgroforestry is a common traditional practice in southern Xinjiang, northwest China. However, intercropping productivity has failed to meet expectations in many agroforestry systems as tree aged. Therefore, this study invested why this occurred. We chose walnut (Juglans regia L. Wen‐185) tree‐based agroforestry systems to investigate the influence of walnut tree shade intensity on the grain yield and quality of intercropped wheat (Triticum aestivum). This replicated study was conducted in Southern Xinjiang China in 2011 and 2012. Walnut tree canopy reduced understory photosynthetically active radiation, decreased photosynthetic rates of intercropped wheat, decreased grain yield, spike number, grains per spike, and thousand‐grain weight. However, grain protein and wet gluten contents were improved. Significant negative linear correlations were detected between grain yield and N content with walnut tree age, but significant positive correlations were found between protein and wet gluten contents with walnut tree age. Protein and wet gluten contents were negatively correlated with grain yield, and with thousand‐grain weight. In conclusion, although grain yield was significantly decreased, grain quality was enhanced in walnut tree‐based agroforestry systems. The competition for light between walnut trees and intercrops could be alleviated by pruning, selective felling, and wider tree spacing.