This study explored drought responses of two eucalypt hybrids (Eucalyptus grandis x Eucalyptus longirostrata (EGL) and Corymbia henryi x Corymbia torelliana (CHT)) with contrasting water use strategies, to identify how key leaf-level functional traits (stomatal and light harvesting behaviour) influence the trade-off between growth rate and drought tolerance traits. The data showed distinct water-use strategies in the two varietals, resulting in a differential fit between responses predicted by a gain:risk approach in the two varietals. Model predictions more closely matched measurements in EGL, which showed a more isohydric response to drought (i.e. more rapid stomatal closure) and less closely in CHT which showed a more anisohydric response (i.e. lower but less drought-responsive stomatal conductance). Varietal differences in growth measures reflected these leaf level functional traits, with CHT showing a significantly higher relative increase in biomass than EGL by the end of the experiment, regardless of water treatment.