A reduction in urinary nitrogen (N) excretion from dairy cows fed pasture containing a high N concentration in the dry matter (DM) will have environmental benefits, because losses to soil water and air by leachate and nitrous oxides (N2O) will be reduced. Condensed tannins (CT) reduce digestion of N, and provision as a dietary additive could have nutritional benefits for production, but the amount required and the responses to different sources of CT on milk production have not been defined. Two experiments were conducted to evaluate effects of supplementation with CT extracted from black wattle (Acacia mearnsii De Wild.) on milk production and faecal N concentration by lactating dairy cows grazing a vegetative Perennial ryegrass (Lolium perenne L.)-based pasture. In one experiment, CT was administered as a drench, twice daily, to 38 multiparous Holstein–Friesian cows assigned to four treatments; control (CONT, 0 g/day), low CT (LCT, 111 g/day), medium CT (MCT, 222 g/day) and high CT (HCT, 444 g/day), grazing as a single group. The CT supplementation affected milk yield (P < 0.001) with a trend of declining milk yield as CT concentration increased from about 0.6 to about 2.9% of dietary DM. Milk urea nitrogen (MUN) decreased at MCT and HCT levels of supplementation (P < 0.01) but milk fat, CP and lactose percentage were not affected by CT supplementation. The CT supplementation increased N concentration in faeces for LCT and MCT treatments (P < 0.05), suggesting partitioning of dietary N away from urine. When CT was pelleted with grain, in a second experiment and fed twice daily as a supplement at milking, it reduced the acceptability relative to pellets without CT, and tended to lower milk production from 25.4 to 24.5 kg/day, although the decline was not significant (P > 0.05). The diet of cows fed pellets with CT contained about 1.2% CT in the DM but neither milk constituents nor MUN were affected by CT-supplemented grain (P > 0.05). These findings demonstrate beneficial effects for production of low concentrations (c. 0.6% DM) of CT from black wattle when given to cows grazing pasture with an N concentration of 3.8%, and suggest a diversion of N from urine, but when CT exceeded about 1.4% of dietary DM, milk production was depressed. The value of supplementing a pasture diet for lactating dairy cows with black wattle tannin extract will depend on costs of supplementation, returns from milk production and liabilities associated with N losses to urine.