Identifying optimal fertilizer management to ensure high nutrient use efficiency is important to reduce negative environmental impacts in oil palm (Elaeis guineensis) cultivation. A 4-year fertilizer trial was established in an oil palm plantation, located at a sandy area with occasional monthly water deficit in Central Kalimantan. We examined the responses of oil palm yield and nutrient use efficiency to fertilizer application frequency (standard frequency of 1–2 times yr-1 versus 4 times yr-1) and rate (standard rate of 136, 12, and 200 kg ha-1 yr-1 of N, P and K, respectively versus 80% of standard rate). There were no treatment effects on annual yield in fresh fruit bunch, bunch number, or individual bunch weight. Increasing fertilizer frequency did not increase nutrient use efficiency at the last 2 years of the trial. In contrast, reducing fertilizer rate resulted in higher nutrient use efficiency in K, compared to the standard treatment and increasing fertilizer frequency. Average concentrations of N, P, K, Mg, Ca, and Cl in leaflet under all treatments were above critical levels both in the beginning and at the end of the trial. Monthly yield in fresh fruit bunch correlated positively with soil water balance with correlation coefficients of 0.24–0.29, during the developmental period of inflorescence sex differentiation at 28–30 months before fruit maturity. Our study provides useful information for fertilizer management optimization in sandy areas with occasional water deficit, corresponding to most of the new expansion areas of oil palm in Southeast Asia.