A study was conducted to evaluate performance of two rice (Oryza sativa L.) varieties under water saving irrigation through alternate wetting and drying in sandy clay loams of Southern Malawi. The varieties, Nunkile and NERICA 4, are adapted to upland and lowland irrigated conditions, individually, and commonly grown by farmers. Four irrigation regimes were used in the study: (1) continuous flooding with surface water level kept at approximately 5 cm throughout crop duration (CFI), (2) alternate wetting and drying up to start of flowering after which continuous flooding was applied (AWD1), (3) alternate wetting and drying up to start of grain filling after which continuous flooding was applied (AWD2) and (4) alternate wetting and drying throughout the crop duration (AWD3). While seasonal crop water requirement was 690 mm, total irrigation depths were 1923.61, 1307.81, 1160.61 and 807.87 mm for the four regimes respectively. The CFI treatment used 32%, 40% and 58% more water than AWD1, AWD2, and AWD3 regimes respectively. In the same treatment order, the average yields per treatment for Nunkile were 4.92, 4.75, 4.74, and 4.47 t ha−1 with significant yield differences among CFI, AWD2 and AWD3 treatments. The average yields per treatment for NERICA 4 were 3.93, 3.75, 3.75, and 3.71 t ha−1 with significant yield differences only between CFI and all AWD treatments. Crop water productivity (CWP) was higher for Nunkile compared with NERICA 4 across all irrigation treatments, while CWP for CFI treatment was superior to all three AWD treatments grown under either variety. Thus, CWP was not increased with AWD irrigations. AWD till flowering and grain filling did not significantly differ with respect to yield and CWP. It is suggested that for similar conditions and where water is scarce, rice can be grown by AWD till grain filling as it saved more water. An important part of the research is to extend the initial results beyond the climate and soils of study.