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Abstract Plant functional trait analyses have focused almost exclusively on vascular plants, but bryophytes comprise ancient and diverse plant lineages that have widespread global distributions and important ecological functions in terrestrial ecosystems. We examined a diverse clade of dryland mosses,Syntrichia, and studied carbon balance during a precipitation event (C‐balance), a functional trait related to physiological functioning, desiccation tolerance, survival, and ecosystem carbon and nitrogen cycling. We examined variability in C‐balance among 14 genotypes ofSyntrichiaand measured an additional 10 physiological and 13 morphological traits at the cell, leaf, shoot, and clump level. C‐balance varied 20‐fold among genotypes, and highest C‐balances were associated with long, narrow leaves with awns, and small cells with thick cell walls, traits that may influence water uptake and retention during a precipitation event. Ordination analyses revealed that the axis most strongly correlated with C‐balance included the maximum chlorophyll fluorescence,F_m, indicating the importance of photosystem II health for C exchange. C‐balance represents a key functional trait in bryophytes, but its measurement is time intensive and not feasible to measure on large scales. We propose two models (using physiological and morphological traits) to predict C‐balance, whereby identifying simpler to measure traits for trait databases.