Persistence is consistently claimed by Australian farmers as a high priority for perennial grasses in long-term pastures. Phalaris (Phalaris aquatica L.) is a productive perennial grass with proven persistence in south-eastern Australia. Nevertheless, factors that determine the persistence of pasture species in southern Australia related to climate (drought), soil (acidity), grazing pressure, and, importantly, their interaction can reduce persistence of phalaris and other species in various situations. These factors and their interactions are discussed in this review, and strategies to improve persistence with emphasis on plant breeding approaches are considered, with the most durable outcomes achieved when breeding and management options are employed concurrently. Two examples of breeding to improve persistence traits in phalaris are described. A program to improve acid-soil tolerance resulted first in the release of cv. Landmaster, and recently Advanced AT, which is the most aluminium (Al)-tolerant cultivar of phalaris to date. It was bred by recurrent selection on acid soils in a population containing genes from a related, more Al-tolerant species, P. arundinacea. The higher Al tolerance of cv. Advanced AT is of most benefit in more assured establishment on acid soils under variable moisture conditions and confers improved flexibility of sowing date. Cultivar Holdfast GT was bred to address complaints of poor persistence under heavy grazing by cultivars of the highly productive, winter-active type, since high grazing tolerance is needed to achieve profitable returns from developed pastureland. Evidence of good persistence under grazing for cv. Holdfast GT and possible tradeoffs with productivity are discussed. Maintaining high productivity under a predicted higher incidence of drought stress (climate change) and increasing areas of acid soils presents ongoing challenges for persistence in pastures.