Summary1. Global climate models suggest that many ecosystems will experience reduced precipitation over the next century and the consequences for invasive plant performance are largely unknown. Annual invasive species may be able to quickly evolve traits associated with drought escape or tolerance through rapid genetic changes. 2. We investigated the influence of 5 years of water and nitrogen manipulations on trait values in a southern California grassland system. Seeds from two annual grass species (Avena barbata and Bromus madritensis) were collected from experimental plots and grown in a common environment over two generations. We measured 14 physiological, morphological, phenological and reproductive traits. 3. Both species displayed phenotypic differences depending on the water treatment from which they were collected, but not depending on the nitrogen treatment. Both species displayed trait values characteristic of drought escape (e.g. earlier flowering in A. barbata and B. madritensis, lower water-use efficiency in B. madritensis) when grown from the seeds collected from plots that experienced five years of reduced precipitation. Furthermore, A. barbata individuals grown from the seeds collected from drought plots had higher reproductive output and higher photosynthetic performance than individuals grown from water addition plots, with individuals grown from ambient plots displaying intermediate trait values. Notably, we found no phenotypic variation among treatments for six root traits. 4. Synthesis. Trait differences were observed following two generations in a common garden, suggesting that treatment differences were genetically based. This suggests that populations were responding to selection over the 5 years of water manipulations, a remarkably short time period. The rapid evolutionary responses observed here may help these two widespread invasive grass species thrive under reduced precipitation scenarios, which could have important implications for fire dynamics, invasive species management and native plant restoration in communities invaded by annual grasses.