Background: DevelopingMedicago sativaL. (alfalfa) cultivars tolerant to drought is critical for the crop’s sustainable production. miR156 regulates various plant biological functions by silencing SQUAMOSA-PROMOTER BINDING PROTEIN-LIKE (SPL) transcription factors.Results: To understand the mechanism of miR156-modulated drought stress tolerance in alfalfa we used genotypes with altered expression levels of miR156, miR156-regulatedSPL13, andDIHYDROFLAVONOL-4-REDUCTASE(DFR) regulatingWD40–1. Previously we reported the involvement of miR156 in drought tolerance, but the mechanism and downstream genes involved in this process were not fully studied. Here we illustrate the interplay between miR156/SPL13 and WD40–1/DFR to regulate drought stress by coordinating gene expression with metabolite and physiological strategies. Low to moderate levels of miR156 overexpression suppressedSPL13and increasedWD40–1to fine-tuneDFRexpression for enhanced anthocyanin biosynthesis. This, in combination with other accumulated stress mitigating metabolites and physiological responses, improved drought tolerance. We also demonstrated that SPL13 binds in vivo to theDFRpromoter to regulate its expression.Conclusions: Taken together, our results reveal that moderate relative miR156 transcript levels are sufficient to enhance drought resilience in alfalfa by silencingSPL13and increasingWD40–1expression, whereas higher miR156 overexpression results in drought susceptibility.