Sand as a moisture control by top-dressing
Can sand be used on a lawn to help retain moisture? This would be done as a top-dressing.
Travis County Texas
Sand may be used to top dress a lawn, but normally is not, and will not improve moisture holding capacity. Top dressing of any kind should only be done in the late winter/early spring, when grass is dormant and before it wakes up for the spring. And top dressing with compost is preferable to sand.
If you are trying to increase moisture holding capacity, you should aerate the soil, but again, not until next late winter/early spring. Aerating allows more water and air into the soil and helps to soften it. In the drought, most lawns get compacted and so don't hold as much water.
Here is an article with Extension information on top dressing. Dr. Unruh is in Florida now, but his information is also applicable to Texas.