Not everyone can dig up their yard full of sod in favor of native plants because some municipalities or homeowner associations dictate what you can or can't do with your front garden (though, nothing is stopping you from doing this to your back garden!). If you happen live in an area where you are required to keep a traditional green lawn, I found some tips you may want to look into.
Less Lawn gives us from great ideas about how to lessen the footprint of your water thirsty lawn:
1. Hedge your lawn - Basically, this entails digging up the perimeter of your lawn in favor of a hedge. To keep the lawn from infiltrating the new growing bed, you'll want to edge it with stone, brick or cement. If you lay it at ground level, it will enable you to mow more easily.
2. Connect the dots - If you have several random planting areas in your yard, you can consolidate them into one, larger, planting area. To get an idea of what it would look like, get some rope or a hose and map out the area to see where you would be removing sod. This way you can "try out" the shape before you do any digging.
3. Cut-out the center - You can make a planting area or a patio in the center of your lawn. Plant natives to attract wildlife or ring a hidden patio with a planting bed.
4. Let it go wild - Let a piece of your lawn go back to its natural state to become and oasis for local wildlife. Decide which part of your lawn to convert and replace it with native plants.
5. Cut a corner - Pick a corner of your lawn and convert it into an herb garden, rock garden or a space for something else you'd been dying to grow.
For tips on how to "smother the grass" to properly prepare the area for new plant life (and to prevent the old sod from choking-out the new plants, see Less Lawn for lots of tips and instructions.
(Images: Owen Chubb Landscapers)