This study examined the water relations of sclerophyllous evergreen vegetation (wallum) on coastal sand barriers in eastern Australia. Many wallum species may be groundwater dependent, although the extent of this dependency is largely unknown. Twenty-six perennial tree, shrub and herb species were investigated in three groundwater habitats (ridge, open depression, closed depression). Pre-dawn and midday shoot xylem water potentials (ᴪₓ) were measured monthly between late autumn 2010 and late summer 2011. Pressure-volume curve traits were determined in mid- to late spring 2009, including the osmotic potential at full (π100) and zero (π0) turgor, and bulk modulus of elasticity (ε). Carbon isotope ratios (δ¹³C) were also determined in mid- to late spring 2009, to measure water-use efficiency (WUE). The species displayed a range of physiological strategies in response to water relations, and these strategies overlapped among contrasting growth forms and habitats. Linear relationships between osmotic and elastic adjustment were significant. A strong correlation between δ¹³C and distribution along the hydrological gradient was not apparent. 'Banksia ericifolia' subsp. 'macrantha' (A.S.George) A.S.George, 'Eucalyptus racemosa' Cav. subsp. 'racemosa' and 'Eucalyptus robusta' Sm. displayed little seasonal variation in ᴪₓ and maintained a comparatively high pre-dawn ᴪₓ, and are therefore likely to be phreatophytic. Wetland vegetation in the lowest part of the landscape appeared to tolerate extreme fluctuations in water availability linked to a prevailing climatic pattern of variable and unreliable seasonal rainfall.