Improvements in malting quality are important if barley from south-eastern Australia is to remain competitive on export markets. Grain is desired that will produce high levels of malt extract and diastatic power but has moderate levels of grain protein. To examine cultivar and environmental effects, especially nitrogen (N) fertilizer, on levels of malting quality parameters and their correlations, seven cultivars of barley were grown in a fallow and pea stubble rotation with five levels of N fertilizer in the Wimmera region of Victoria in 1990 and 1991. The first season was relatively dry and warm, while the second was wetter and cooler. Grain yield and malt extract were markedly lower in 1990 than 1991, and grain protein concentration, grain screenings and diastatic power were significantly higher. Grain protein and diastatic power increased almost linearly with increasing N application, with a higher rate of increase in 1990 than in 1991. Malt extract declined almost linearly with increasing N application, but the change in rate of decline between seasons was less than the change of rate of increase of grain protein. Environmental correlations between protein concentration and malt extract, and between malt extract and diastatic power, were negative. They were close to -1.0 when the environmental factor varying was restricted to N fertilizer, but were of a smaller absolute magnitude when seasons and rotations were also allowed to vary. In contrast, genotypic correlations were of intermediate magnitude. Broad-sense heritabilities for malt extract and diastatic power were relatively high, even with such contrasting seasons. This indicates that it should be possible to develop cultivars for south-eastern Australia which have high malt extract and high diastatic power at low protein levels. However, applications of N fertilizer that raise grain protein concentration will reduce malt extract, with the effect much greater in drier, warmer seasons.