Research on the potential of greywater reuse to reduce urban tap water demand has focused mainly on permanently installed greywater treatment or irrigation systems. These may be readily implemented in new housing developments, but experience in Australia shows their uptake by established households in urban areas is low. The majority of households employ simple and temporary methods for greywater collection and use, but their behaviour has not been well documented. We characterised the greywater use practices of over 1,000 Melbourne households during a 5-year period (2007 to 2011) which included 3 years of severe drought with stringent restrictions on outdoor tap water use. Greywater was most frequently collected from the laundry and bathroom, and generally used within 24 hours. Garden watering was the most common end use, and treatment of greywater to reduce microbial contamination was very rare. Volume estimates by householders suggest that on average around 10% of tap water used in the home was being collected for reuse. When drought conditions and water restrictions eased, over 40% of user households discontinued greywater use. Widespread adoption of permanent greywater collection, treatment and storage systems by households would be required to achieve a lasting effect on urban water consumption.