Water adsorption on the cubic (111) surface of yttria-stabilized zirconia (YSZ) was investigated using density functional theory calculations. Relaxation of atomic positions away from ideal cubic lattice sites, in particular of the oxygen anion sublattice, is observed on including both phase-stabilizing dopants and water adsorption. A large slab model has been used to explore the effects of extended relaxation throughout the anionic sublattice and the role of vacancy-vacancy interactions on water adsorption. Dissociative adsorption of water to fill a surface vacancy site, accompanied by concerted oxygen movement in the vacancy cluster region of the slab, leads to a very strong adsorption of -2.20 eV, blocking surface sites for oxygen activation. We show that the use of larger slab models leads to a more detailed representation of the YSZ surface system.