Perennial ryegrass (Lolium perenne L.) infected with a novel endophyte (AR37 or AR1), Wild-type endophyte or no endophyte (Nil) was sown with white clover (Trifolium repens L.) in autumn 2005. The pastures were rotationally grazed by dairy cows from 2005–2009. Annual dry matter (DM) yield did not differ but AR37 pastures had a higher ryegrass tiller density, especially after the 2008 summer drought (+130%), and less white clover than did AR1 pastures. Concentrations of alkaloids produced by the Wild-type association (lolitrem B, ergovaline) followed the same seasonal trends as did the AR37 alkaloids (epoxy-janthitrems) but summer drought reduced concentrations of lolitrem B and epoxy-janthitrems to less than half the mid-summer (February) peak concentrations in the other years. Insect pests were monitored annually between 2006 and 2009. Tiller damage by Argentine stem weevil (Listronotus bonariensis (Kuschel)) was significantly reduced by all endophyte treatments. African black beetle (Heteronychus arator (F.)) populations in soil samples increased during the experiment with Nil > AR1 > Wild-type = AR37. Root aphid (Aploneura lentisci (Pass.)) infestations followed the pattern AR1 > Nil > Wild-type = AR37. A lower pest pressure from all insect pests in AR37 pastures is likely to have contributed to this treatment having the highest ryegrass tiller densities.