Aquatic plants include a variety of life forms and functional groups that are adapted to diverse wetland habitats. Both similarities and differences in seed and seed‐bank characteristics were discovered in comparisons of Australian (New South Wales) temporary upland wetlands with a North American (New Jersey) tidal freshwater marsh having both natural and constructed wetlands. In the former, flooding and drying are unpredictable and in the latter water levels vary diurnally and substrate is constantly moist. The hydrologic regimen provides the overriding selective force, with climate an important second factor. Other factors related to water level, such as oxygen availability, temperature and light, vary spatially and temporally, influencing germination processes, germination rates and seedling establishment. Seed and seed‐bank characteristics (size, desiccation and inundation tolerance, germination cues and seed‐bank longevity and depletion) differ, with the Australian temporary wetland being more similar to the small‐seeded persistent seed bank of the constructed wetland site than to the natural tidal freshwater site with its larger seeds, transient seed bank and seasonal spring germination. Some non‐spring germination can occur in the tidal constructed wetland if the soil is disturbed. In contrast, seeds in the temporary Australian wetlands germinated in response to wet/dry cycles rather than to season. Functional groups (e.g. submerged, amphibious) are more diverse in the Australian temporary wetlands, where all species tolerate drying. We suggest that the amphibious zone, with its hydrologic gradient, is the site of selection pressure determining establishment of wetland plants from seed. In this zone, multiple selective factors vary spatially and temporally.