The economic impact of foot-and-mouth disease (FMD) has been poorly characterised particularly in endemic settings where such knowledge is important for decision-making on disease control with limited resources. In order to address this, a study was designed using individual animal data from a large-scale dairy farm in Kenya to estimate the impact of an FMD outbreak due to serotype SAT2 virus on milk yield. Daily milk yields from 218 mainly European-breed cattle that were lactating during the 29-day outbreak period were considered in the analysis. At the herd level, the average daily yields decreased from around 20 to 13 kg per cow, recovering approximately 2 months after the commencement of the outbreak. Generalised estimating equations (GEE) and an autoregressive correlation matrix were used to compare yields of reported clinical FMD cases and non-cases. No difference was found between reported clinical and non-clinical cases suggesting inaccurate case recording, poor sensitivity of the case definition and subclinical infections being present. To further investigate the impact of FMD, yields were predicted for each individual animal based on historic data from the same herd using a similar GEE approach. For cattle lactating during the outbreak, comparisons were made between actual and predicted yields from the commencement of the outbreak to 305 days lactation using a linear regression model. Animals produced significantly less than predicted if in parity 2 or greater and between 0 and 50 days in milk (DIM) at the start of the outbreak period. The maximum effect was seen among animals in parity ≥4 and between 0 and 50 DIM at the start of the outbreak, producing on average 688.7 kg (95%CI 395.5, 981.8) less milk than predicted for their remaining lactation, representing an average 15% reduction in the 305 day production for these animals. Generalisation of the results requires caution as the majority of Kenyan milk is produced in smallholder farms. However, such farms use similar genetics and feeding practices to the study farm, and such systems are increasingly important in the supply of milk globally. These results make an important and unique contribution to the evidence base on FMD impact among dairy cattle in an endemic setting.