In this paper, we advanced the concept of nitrogen-use efficiency (NUE) of cropping systems by linking current crop- and soil-based approaches into a system NUE. We compared this new index to traditional metrics, and show how its application can yield insights about N cycling dynamics and tradeoffs. Display omitted •Developed a novel systems NUE (sNUE) by synthesizing crop and soil-based approaches.•The maize-soybean rotation removed 87% of N inputs in grains.•45% of the N losses were due to inefficient N input use; the rest to poor N retention.•Balancing production-environmental tradeoffs resulted on a yield penalty of 5–7%.•sNUE was relatively more stable and less correlated to other metrics. Increasing nitrogen (N)-use efficiency (NUE) is key to improving crop production while mitigating ecologically-damaging environmental N losses. Traditional approaches to assess NUE are principally focused on evaluating crop responses to N inputs, often consider only what happens during the growing season, and ignore other means to improve system efficiency, such as by tightening the cycling of soil N (e.g. with N scavenging cover crops). As the goals of improving production and environmental quality converge, new metrics that can simultaneously capture multiple aspects of system performance are needed. To fill this gap, we developed a theoretical framework that links both crop- and soil-based approaches to derive a system N-use efficiency (sNUE) index. This easily interpretable metric succinctly characterizes N cycling and facilitates comparison of systems that differ in biophysical controls on N dynamics. We demonstrated the application of this new approach and compared it to traditional NUE metrics using data generated with a process-based model (APSIM), trained and tested with experimental datasets (Iowa, USA). Modeling of maize-soybean rotations indicated that despite their high crop NUE, only 45% of N losses could be attributed to the inefficient use of N inputs, whereas the rest originated from the release of native soil N into the environment, due to the asynchrony between soil mineralization and crop uptake. Additionally, sNUE produced estimates of system efficiency that were more stable across weather years and less correlated to other metrics across distinct crop sequences and N fertilizer input levels. We also showed how sNUE allows for the examination of tradeoffs between N cycling and production performance, and thus has the potential to aid in the design of systems that better balance production and environmental outcomes.