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In order to understand the physiology and ecology of perennial shrub species occupying the banks of ephemeral streams we studied the plant water relations and gas-exchange characteristics of six perennial shrub species growing along an ephemeral stream (arroyo) in the northern Chihuahuan Desert. Two of the species are restricted to riparian habitats (Brickellia laciniata and Chilopsis linearis), three are classified as semi-riparian (Fallugia paradoxa, Prosopis glandulosa, and Rhus microphylla) and one is considered to be non-riparian (Flourensia cernua). Differences in gas-exchange patterns and water relations emerged among these six species, yet differences among obligate, semi-riparian, and non-riparian classes of species were evident, but not universal. Chilopsis and Brickellia did not develop the low plant water potentials that characterized some semi-riparian (Rhus) and non-riparian species (Flourensia) during periods of drought. Rates of photosynthesis and transpiration were highest in Prosopis throughout the study, and were relatively constant in Chilopsis during and after drought. Whether water became available as channel flow or direct rainfall appeared to play a role in the physiology of these arroyo shrubs. [Copyright &y& Elsevier]