Changes in land use and climate interfere with grassland ecosystem processes. Here I experimentally investigated the combined effects of land-use change related litter cover and contrasting water supply on seedling emergence. In this context, the role of the initial relative position of seeds, i.e. seeds on top of the litter versus seeds beneath the litter in interaction with water supply has not been investigated so far. I hypothesised that facilitative effects of litter on seedling emergence occur when seeds are covered by litter and deteriorate when litter covers the ground and seeds fall on it (seeds on top of the litter). Further, I hypothesised that the importance of seed position for seedling emergence will increase under conditions of recurrent drought. I performed a controlled pot experiment on seedling emergence of three common European grassland species (Pimpinella saxifraga, Leontodon autumnalis, Sanguisorba officinalis) by experimental manipulations of litter and water availability. Seedling emergence under moist conditions showed no significant differences between each litter position compared to the control across species. In contrast, under recurrent drought, seedling emergence was significantly higher below the litter compared to seeds on top of the litter and the control (i.e. no litter). In abandoned land, seedling emergence may be limited when seeds fall on ground-covering litter. In contrast, in grasslands with regular low-intensity land use, seedling emergence may be enhanced when a moderate level of litter covers seeds at the end of the growing season. Protective mechanisms that occur with seeds positioned beneath litter are particularly important under recurrent drought.