Many trees of tropical dry forests flower or form new shoots soon afte
r leaf shedding during the dry season, i.e., during a period when tree
s are likely to be severely water stressed. To resolve this apparent p
aradox, phenology and seasonal changes in tree water status were monit
ored during two consecutive dry seasons in > 150 trees of 37 species g
rowing at different sites in the tropical dry lowland forest of Guanac
aste, Costa Rica. Tree development during the dry season varied consid
erably between species and between sites of different moisture availab
ility. Leaf shedding, flowering, and shoot growth (flushing) were stro
ngly correlated with seasonal changes in tree water status, measured b
y conventional and newly developed techniques. Tree water status varie
d with the availability of subsoil water and a variety of biotic facto
rs such as structure and life-span of leaves, time of leaf shedding, w
ood density and capacity for stem water storage, and depth and density
of root systems. Observed tree species differed widely in wood densit
y (from 0.19 to 1.1 g/cm(3)) and stem water storage capacity (400-20%
of dry mass), which was highly correlated with the degree of desiccati
on during drought. Only hardwood trees at dry upland sites, lacking st
em water storage and access to subsoil water, desiccated strongly (ste
m water potential < -4 MPa) and remained inactive throughout the dry s
eason. In all other trees elimination of transpirational water loss du
ring leaf shedding in conjunction with utilization of residual water e
nabled rehydration of stem tissues and subsequent flowering or flushin
g during the dry season. Rate and degree of rehydration varied strongl
y with the availability of water stored in tree trunks or in the subso
il. Stored water buffers the impact of seasonal drought and enables fl
owering and flushing during the dry season. Climatic data are thus not
sufficient to explain tree phenology in seasonally dry tropical fores
ts. Phenology, seasonal changes in water status, and water storage cap
acity of tree species are highly correlated. Tree species cluster into
a number of distinct functional types ranging from deciduous hardwood
trees and water-storing lightwood trees in dry upland forests to ever
green light- and softwood trees confined to moist lowland sites. Seaso
nal variation in tree water status thus appears to be the principal de
terminant of both phenology and distribution of tree species in tropic
al dry forests.