Riparian vegetation is important for stream functioning and as a major landscape feature. For many riparian plants, shallow groundwater is an important source of water, particularly in areas where rainfall is low, either annually or seasonally, and when extended dry conditions prevail for all or part of the year. The nature of tree water relationships is highly complex. Therefore, we used multiple lines of evidence to determine the water sources used by the dominant tree species Eucalyptus camaldulensis (river red gum), growing in riparian and floodplain areas with varying depth to groundwater and stream perenniality. Dendrometer bands were used to measure diel, seasonal, and annual patterns of tree water use and growth. Water stable isotopes (δ2H and δ18O) in plant xylem, soil water, and groundwater were measured to determine spatial and temporal patterns in plant water source use. Our results indicated riparian trees located on relatively shallow groundwater had greater growth rates, larger diel responses in stem diameter, and were less reactive to extended dry periods, than trees in areas of deep groundwater. These results were supported by isotope analysis that suggested all trees used groundwater when soil water stores were depleted at the end of the dry season, and this was most pronounced for trees with shallow groundwater. Trees may experience more frequent periods of water deficit stress and undergo reduced productivity in scenarios where water table accessibility is reduced, such as drawdown from groundwater pumping activities or periods of reduced rainfall recharge. The ability of trees to adapt to changing groundwater conditions may depend on the speed of change, the local hydrologic and soil conditions as well as the species involved. Our results suggest that E. camaldulesis growing at our study site is capable of utilizing groundwater even to depths >10 m, and stream perenniality is likely to be a useful indicator of riparian tree use of groundwater.