Context: Although green manure growth in dryland agriculture can involve trade-offs with crop production, its yield enhancing potential via improvements in soil fertility still lacks systematic evidence in dryland systems. Methods and objective: To address this gap, we conducted a long-term field experiment from 2015 to 2024 on the Loess Plateau, where soybean, representing leguminous green manure, and sorghum-sudangrass, representing gramineous green manure, were introduced as green manure crops to replace summer fallow in a winter wheat-summer fallow system, in order to examine how the potential benefits of green manure affect crop production. Results and conclusions: The results showed that green manure significantly increased soil organic matter, available nitrogen, available potassium, soil enzyme activities, and soil microbial biomass, which in turn enhanced soil multifunctionality by 112.1-189.3%. Leguminous green manure preferentially enhanced soil available nitrogen (13.2%), whereas gramineous green manure had stronger effects on soil organic matter (12.2%) and fungal biomass (48.0%) in the 0-20 cm. In contrast, green manure reduced wheat yield in some years and had no significant effect in most years. Variance partitioning and hierarchical analyses showed that precipitation explained more interannual variation in wheat yield than soil properties. Only when annual precipitation exceeded 691 and 755 mm for leguminous and gramineous green manure, respectively, did replacing fallow with green manure lead to yield gains, and such precipitation levels are uncommon in dryland agriculture. Therefore, on the Loess Plateau, improvements in soil fertility under green manure, such as increased soil organic matter, available nitrogen, available potassium, and enzyme activities, did not translate into higher wheat yield. Implications: These findings reveal that in precipitation limited regions the value of green manure lies primarily in enhancing soil ecological functions rather than serving as a practice that can be relied upon to deliver short-term yield increases.