We studied the temporal variability and resistance to perturbation of the biomass production of grassland communities from an experimental diversity gradient (the Portuguese BIODEPTH project site). With increasing species richness relative temporal variability (CV) of plant populations increased but that of communities decreased, supporting the insurance hypothesis and related theory. Species-rich communities were more productive than species-poor communities in all three years although a natural climatic perturbation in the third year (frequent frost and low precipitation) caused an overall decrease in biomass production. Resistance to this perturbation was constant across the experimental species richness gradient in relative terms, supporting a similar response from the Swiss BIODEPTH experiment. The positive biomass response was generated by different combinations of the complementarity and selection effects in different years. Complementarity effects were positive across mixtures on average in all three years and positively related to diversity in one season. The complementarity effect declined following perturbation in line with total biomass but, counter to predictions, in relative terms overyielding was maintained in all years. Selection effects were positively related to diversity in one year and negative overall in the other two years. The response to perturbation varied among species and for the same species growing in monoculture and mixture, but following the frost communities were more strongly dominated by species with lower monoculture biomass and the selection effect was more negative. In total, our results support previous findings of a positive relationship between diversity and productivity and between diversity and the temporal stability of production, but of no effect of diversity on the resistance to perturbation. We demonstrate for the first time that the relative strength of overyielding remained constant during an exceptional natural environmental perturbation.