Basic photosynthetic and water relations characteristics in relation to soil water availability were investigated in Amaranthus palmeri, a common C4 summer annual of the Sonoran Desert. Under conditions of high soil water availability, photosynthetic capacity exceeded 70 μmol CO2 m-2 s-1 at a leaf temperature optimum of 42°C, and photosynthesis was not light saturated at an irradiance of 2.0 mmol m-2 s-1 (400–700 nm). Leaves of A. palmeri exhibited diaheliotropic movements, allowing them to take advantage of their high photosynthetic capacity. In response to a long term drought cycle, both photosynthetic rate and leaf conductance to water vapor decreased, reaching minima at an approximate leaf water potential of-2.9 MPa. Active leaf osmotic adjustment appeared to play an important role in allowing leaves to maintain gas exchange activities down to these low leaf water potentials. The photosynthetic rate became light saturated at the lower leaf water potentials. Although the two parameters decreased in concert, the decreased photosynthetic rate was not due to increased stomatal diffusion limitations, since intercellular CO2 concentrations remained constant over the range of leaf water potentials. Instead it appeared that during the drought cycle, both intrinsic photosynthetic capacity and leaf protein content decreased as well. These results suggested a coordination of gas exchange parameters during long term drought such that the intercellular CO2 concentration remained constant.