Genetic variation in ecophysiological and survival responses to drought was studied in 2 northern Arizona native grass species, Koeleria macrantha (Ledeb.) Schult, (prairie Junegrass) and Elymus elymoides (Raf.) Swezey. ssp. elymoides (squirreltail). Low- and high-elevation populations of each species were compared in a greenhouse common garden experiment that included simulated drought. Leaf gas-exchange characteristics were significantly affected by simulated drought and often by population elevation, but gas-exchange responses to drought were similar for high- and low-elevation populations. Compared to high-elevation populations, low-elevation populations of both species had higher net photosynthetic rate and predawn water potential, and for E. elymoides had higher stomatal conductance. Leaf-level water-use efficiency did not differ between populations for either species. Populations also differed significantly in leaf morphological characteristics related to water use. Compared to high-elevation populations, low-elevation populations of both species had smaller leaves. Low-elevation populations of both species survived aboveground longer than high-elevation populations during drought, with a larger difference in K. macrantha than in E. elymoides. These results suggest strong selection for drought adaptation and water use along an elevational and water-availability gradient in native grasses.