The monitoring of the spatial and temporal dynamics of vegetation productivity is important in the context of carbon sequestration by terrestrial ecosystems from the atmosphere. The accessibility of the full archive of medium-resolution earth observation data for multiple decades dramatically improved the potential of remote sensing to support global climate change and terrestrial carbon cycle studies. We investigated a dense time series of multi-sensor Landsat Normalized Difference Vegetation Index (NDVI) data at the southern fringe of the boreal forests in the Mongolian forest-steppe with regard to the ability to capture the annual variability in radial stemwood increment and thus forest productivity. Forest productivity was assessed from dendrochronological series of Siberian larch (Larix sibirica) from 15 plots in forest patches of different ages and stand sizes. The results revealed a strong correlation between the maximum growing season NDVI of forest sites and tree ring width over an observation period of 20 years. This relationship was independent of the forest stand size and of the landscape’s forest-to-grassland ratio. We conclude from the consistent findings of our case study that the maximum growing season NDVI can be used for retrospective modelling of forest productivity over larger areas. The usefulness of grassland NDVI as a proxy for forest NDVI to monitor forest productivity in semi-arid areas could only partially be confirmed. Spatial and temporal inconsistencies between forest and grassland NDVI are a consequence of different physiological and ecological vegetation properties. Due to coarse spatial resolution of available satellite data, previous studies were not able to account for small-scaled land-cover patches like fragmented forest in the forest-steppe. Landsat satellite-time series were able to separate those effects and thus may contribute to a better understanding of the impact of global climate change on natural ecosystems.