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Abstract While variation in mean annual precipitation (MAP) of the native habitat of a species has been shown to determine the ability of a species to resist a hydraulic decrease during drought, it remains unknown whether these variations in MAP also influence the ability of a species to recover and survive drought. Leaf hydraulic and gas exchange recovery following drought and the underlying mechanisms of these responses in sixCaraganaspecies from habitats along a large precipitation gradient were investigated during rehydration in a common garden. The gas exchange of species from arid habitats recovered more rapidly during rehydration after mild, moderate and severe drought stress treatments than species from humid habitats. The recovery of gas exchange was not associated with foliar abscisic acid concentration, but tightly related to the recovery of leaf hydraulic conductance (K_leaf). The recovery ofK_leafwas associated with the loss ofK_leafduring dehydration under mild and moderate drought stress, and to leaf xylem embolism formation under severe drought stress. Results pointed to the different ability to recover in gas exchange in sixCaraganaspecies post‐drought is associated with the MAP of the species in its native habitat.