The War Service Land Settlement Scheme (WSLSS) was deemed necessary by the government following World War II to accommodate the returning soldiers. This scheme ran from 1945 to 1952 and it was used to develop farms on already cleared land that was deemed to be suitable for agriculture. Over the course of the scheme 179 farms were developed.
The Margaret River Wine Region that contained many abandoned group settlement scheme properties became part of the dairy section of the WSLSS. Tobacco was also trialed at Karridale for a second time. By 1947, ten dairy farms had been established
All service personnel who had provided six months service and members of citizen forces including women were eligible to apply to the WSLSS. The scheme offered 12 months assistance and free rent with an allowance of ?6-12-0 with two extra pounds for family groups.
Like the first group settlement scheme, the WSLSS was under prepared and by 1948 was under pressure mainly due to the high capital outlay and lack of machinery. Although the new farms were to be established on already cleared land, some of the properties had been abandoned for 10 to 20 years and therefore required the removal of substantial regrowth.
The WSLSS did manage to reestablish a dairy industry in the region, advance farm quality and increase production. However this success was short lived as the dairy industry began to move north and consolidate around the new Harvey irrigation district, which was opened up in the 1960's.
The town of Rocky Gully was developed through the WSLSS in 1949. The town site was carved from virgin bush by 60 settlers and supported a strong agricultural industry.