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Persian walnut is a drought-sensitive species with considerable genetic variation in the photosynthesis and water use efficiency of its populations, which is largely unexplored. Here, we aimed to elucidate changes in the efficiency of photosynthesis and water content using a diverse panel of 60 walnut families which were submitted to a progressive drought for 24 days, followed by two weeks of re-watering. Severe water-withholding reduced leaf relative water content (RWC) by 20%, net photosynthetic rate (P n) by 50%, stomatal conductance (g s) by 60%, intercellular CO 2 concentration (C i) by 30%, and transpiration rate (T r) by 50%, but improved water use efficiency (WUE) by 25%. Severe water-withholding also inhibited photosystem II functionality as indicated by reduced quantum yield of intersystem electron transport (φ Eo) and transfer of electrons per reaction center (ET 0 /RC), also enhanced accumulation of Q A (V J) resulted in the reduction of the photosynthetic performance (PI ABS) and maximal quantum yield of PSII (F V /F M); while elevated quantum yield of energy dissipation (φ Do), energy fluxes for absorption (ABS/RC) and dissipated energy flux (DI 0 /RC) in walnut families. Cluster analysis classified families into three main groups (tolerant, moderately tolerant, and sensitive), with the tolerant group from dry climates exhibiting lesser alterations in assessed parameters than the other groups. Multivariate analysis of phenotypic data demonstrated that RWC and biophysical parameters related to the chlorophyll fluorescence such as F V /F M , φ Eo , φ Do , PI ABS , ABS/RC, ET 0 /RC, and DI 0 /RC represent fast, robust and non-destructive biomarkers for walnut performance under drought stress. Finally, phenotype-environment association analysis showed significant correlation of some photosynthetic traits with geoclimatic factors, suggesting a key role of climate and geography in the adaptation of walnut to its habitat conditions. • Persian walnut families respond differently to water-withholding and subsequent re-watering conditions. • Functionality of photosynthetic apparatus is the main source of natural variation among Persian walnut families. • Drought stress inactive PSII reaction centers and down-regulate electron transport in the drought-sensitive walnut families. • Re-watering could partially restore photosynthetic functionality in the drought-sensitive walnut families. • Parameters derived from fast induction of chlorophyll fluorescence provide fast and robust biomarker for screening walnut families in response to water scarcity. • Photosynthesis functionality of Persian walnut families under water-withholding depend on the climatic condition of original habitant. [ABSTRACT FROM AUTHOR]