Abstract It is generally accepted that liming ameliorates soil acidity. However, the method of lime application is thought by many to influence its effectiveness in acid soils. In this study, we wanted to assess the degree of effectiveness of surface‐applied lime and lime incorporated into the soil on soil structural attributes and water retention of a Dystrudept soil in the SE region of the State of Paraná, Brazil. Lime was added at the rate of 15 t/ha to soil through: (i) surface broadcasting, (ii) incorporation via ploughing and harrowing, (iii) incorporation via subsoiling and harrowing. A control treatment with zero lime application was included in the experiment. The addition of lime by surface broadcasting resulted in significant reductions in soil bulk density ( BD ) and macroporosity (Ma) and increases in total porosity ( TP ) and microporosity (Mi) of the top soil layer (0–0.10 m). The reverse was the case in the 0.10‐ to 0.20‐m soil layer; where lime was incorporated via ploughing and harrowing, increases in BD and reductions in TP and Ma were observed. Addition of lime also significantly increased soil water retention, with maximum retention recorded from soil amended with surface broadcast lime. Changes in soil chemical attributes (increases in pH , Ca 2+ and Mg 2+ contents; reductions in potential acidity and Al 3+ content) were responsible for the changes observed in structural and physical attributes, and water retention. Bearing in mind the lower application costs, improvement in the soil chemical attributes for plant development and soil physical quality, surface broadcast lime can be considered a promising alternative for no‐till farmers.