Fallow land provides habitat for threatened and declining farmland biodiversity. Policy change under the EU's Common Agricultural Policy (CAP) has been driving the area of fallows over the past decades and influenced trends in farmland biodiversity. We analyzed the impact of changes in fallow area across Germany on species richness and abundance of farmland birds over three CAP funding periods. We examined whether responses to fallow land area were modulated by species habitat preferences and landscape complexity. We combined spatial data on fallow land area from three agricultural censuses in Germany (2007, 2010 and 2016) with country-wide, annual monitoring data on farmland birds. Farmland bird species richness and the abundance of edge- and field-breeders responded positively to increases in fallows. The effect of fallows on bird richness was strongest at intermediate levels of landscape complexity. There was support for an increasing effect strength of fallow land area on field-breeders' abundance with increasing landscape complexity. We conclude that the loss of fallows in the period 2007 to 2016 resulted in strong declines of farmland birds. We predict that a future increase of the proportion of fallow land to 4%, as envisaged in the post-2020 CAP for Germany, will result in an average increase of 7% in farmland bird species richness and of 11% in average farmland bird abundance compared to 2016, but will depend on species-specific habitat preferences. Increasing the proportion of fallow land will be a key lever to stabilize and revert negative farmland bird population trends. An increase of fallow area in all but the least complex landscapes will boost farmland bird richness and abundance of field breeders. Increasing the proportion of fallow land to 4% is projected to, on average, bring farmland bird richness and abundance back to the levels observed in 2007 acknowledging that farmland bird populations were already severely depleted in 2007. A more ambitious expansion of fallow land towards 10%, such as in the context of the EU Biodiversity Strategy for 2030, should be targeted towards areas that experienced the strongest loss of fallows and towards landscapes with intermediate structural complexity.