A micrometeorological experiment was conducted over grasslands in a semi-arid region of north-eastern Brazil (São João, Pernambuco) from January to December 2011, using the Bowen ratio energy balance method, to improve the current understanding of energy partitioning and water vapour exchange over this ecosystem in this region. The objectives of the present study were to quantify the seasonal and diurnal variations in energy and water vapour exchanges over grasslands and understand the biotic and abiotic factors controlling the energy partitioning of this ecosystem. In the dry period, the low stored soil water limited the grass production and leaf area index, and as a consequence of these conditions, most of the annual net radiation (58%) was consumed in sensible heat flux. During the course of the study the evaporative fraction was linearly related to the leaf area index. The total annual evapotranspiration and its daily maximum were 543.8 mm and 3.14 mm d-1. The seasonal and diurnal variations in energy partitioning and evapotranspiration were controlled by soil water availability and leaf area index.