The microclimate of the Horotane Valley is characterised to enable an assessment of land-use potential in the valley. Crops that are traditionally thought of as marginal or unsuitable for commercial growth on the Canterbury Plains, can be grown successfully in the valley. While the residents of the valley have a qualitative appreciation of the climate, no quantitative data had previously been collected to characterise the microclimate. Data collection took place over a five month period from 14th February 1995 to 31 July, 1995. Field observations of maximum and minimum temperature and short-wave radiation are augmented by modelling. Temperature data are used to determine the Growing Degree Day, chill unit and frost distribution. Continuous monitoring of the wind in the upper valley allows analysis of the diurnal and seasonal variation in the wind regime. Radiation receipt varies with slope angle and aspect. Radiation modelling using the "Cosine Law of Illumination" produces comparatively high results as cloud cover, air pollution levels and sky view factors are not taken into account. Albedo varies with the surface colour, roughness and moisture level. Growing degree days initially increase with elevation, until the lower maximum temperatures in the thermal belt counteract the higher minimum temperatures. Chill units decrease with elevation in the thermal belt and then increase again. Frosts are most common on the valley floor and decrease in frequency and severity with elevation up the valley slopes. A temperature inversion is most likely to develop under anticyclone conditions when the nocturnal long-wave emission is at a maximum. Nocturnal temperatures follow the normal lapse rate when the atmosphere is well-mixed. Diurnal temperatures tend to follow the normal lapse rate. Thermotopographically generated winds are prominent in the valley wind regime. The northerly anabatic wind develops in the valley following sunrise. It reaches peak velocity in the afternoon when backed by the low level gradient north-easterly and the sea breeze. A light southerly katabatic flow dominates the nocturnal wind regime. Gradient winds are modified by the valley topography and shelter is needed from the gradient southerly winds as they reach maximum speeds of 15 m/s. The valley is topographically sheltered from winds from an easterly arid westerly direction. Published knowledge of the climatic requirements of selected crops was used to evaluate their suitability to the Horotane Valley microclimate. The research has shown that the valley climate could support other marginal crops such as grapes and kiwifruit, and that the area planted in stonefruit could be extended.