In Australia, dairy farming is carried out in environments that vary in many ways, including level of feeding and climate variables such as temperature and humidity. The aim of this study was to assess the magnitude of genotype x environment interactions (GxE) on milk production traits (milk yield, protein yield, and fat yield) for a range of environmental descriptors. The environment on individual test days was described by herd size (HS), average herd protein yield (AHTDP), herd test-day coefficient of variation for protein yield (HTDCV), and temperature humidity index (THI). A sire random regression model was used to model the response of a sire's daughters to variation in the environment and to calculate the genetic correlation between the same traits measured in two widely different environments. Using test-day records, rather than average lactation yields, allowed exploitation of within-cow variation as well as between-cow variation at different levels of AHTDP, and led to more accurate estimates of sire breeding values for "response to environment." The greatest GxE observed was due to variation in AHTDP, with a genetic correlation of 0.78 between protein yield when AHTDP = 0.54 kg and protein yield when AHTDP = 1.1 kg (the 5th and 95th percentile of the distribution of AHTDP). The GxE was also observed for THI, with a genetic correlation of 0.90 between protein yield at the 5th and 95th percentile of THI. The use of response to environment estimated breeding values to improve the accuracy of international sire evaluations is discussed.