Precipitation in dryland ecosystems is becoming less frequent but more intense, and this trend is expected to continue. The positive, negative, and neutral impacts of precipitation temporal repackaging on dryland productivity have been observed, and the underlying mechanisms remain unclear. We combined observations from a precipitation manipulation experiment in a semi-arid grassland to improve the Community Land Model (CLM5.0)'s simulation of coupled soil water-vegetative growth responses to changing hydroclimate conditions. Parameterizing the distinct phenological, photosynthetic, and structural traits of annual and perennial C3/C4 grasses significantly improved the simulation of this grassland productivity and evapotranspiration under varying precipitation patterns. Incorporating soil hydraulic parameters fitted to observations notably reduced the overestimation of soil water in the Arizona semi-arid grassland. The improved model enables us to interpret the mechanisms that determine the direction and magnitude of semi-arid grassland productivity responses to changing hydroclimates, highlighting that the coexistence of diverse annual and perennial grasses with distinct functional traits and complementary water uptake behaviors, combined with coarse, highly permeable soils in the semi-arid grassland enhances the plant community's uptake of soil water across time and depths, thereby increasing the resilience of this semi-arid grassland to more extreme hydroclimate.