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Abstract Managing ecosystems to effectively preserve function and services requires reliable tools that can infer changes in the stability and dynamics of a system. Conceptually, functional diversity (FD) appears as a sensitive and viable monitoring metric stemming from suggestions that FD is a universally important measure of biodiversity and has a mechanistic influence on ecological processes. It is however unclear whether changes in FD consistently occur prior to state responses or vice versa, with no current work on the temporal relationship between FD and state to support a transition towards trait‐based indicators. There is consequently a knowledge gap regarding when functioning changes relative to biodiversity change and where FD change falls in that sequence. We therefore examine the lagged relationship between planktonic FD and abundance‐based metrics of system state (e.g. biomass) across five highly monitored lake communities using both correlation and cutting edge non‐linear empirical dynamic modelling approaches. Overall, phytoplankton and zooplankton FD display synchrony with lake state but each lake is idiosyncratic in the strength of relationship. It is therefore unlikely that changes in plankton FD are identifiable before changes in more easily collected abundance metrics. These results highlight the power of empirical dynamic modelling in disentangling time lagged relationships in complex multivariate ecosystems, but suggest that FD cannot be generically viable as an early indicator. Individual lakes therefore require consideration of their specific context and any interpretation of FD across systems requires caution. However, FD still retains value as an alternative state measure or a trait representation of biodiversity when considered at the system level.