Drought stress can significantly affect plant growth, development, and yield. Fewer comparative studies have been conducted between different species of pines, particularly involving Pinus yunnanensis var. pygmaea (P. pygmaea). In this study, the physiological indices, photosynthetic pigment and related antioxidant enzyme changes in needles from P. pygmaea, P. elliottii and P. massoniana under drought at 0, 7, 14, 21, 28 and 35 d, as well as 7 days after rehydration, were measured. The PacBio single-molecule real-time (SMRT) and Illumina RNA sequencing were used to uncover the gene expression differences in P. pygmaea under drought and rehydration conditions. The results showed that the total antioxidant capacity (TAOC) of P. pygmaea was significantly higher than P. massoniana and P. elliottii. TAOC showed a continuous increase trend across all species. Soluble sugar (SS), starch content and non-structural carbohydrate (NSC) of all three pines displayed a "W" pattern, declining initially, increasing, and then decreasing again. P. pygmaea exhibits stronger drought tolerance and greater recovery ability under prolonged drought conditions. Through the PacBio SMRT-seq, a total of 50,979 high-quality transcripts were generated, and 6,521 SSR and 5,561 long non-coding RNAs (LncRNAs) were identified. A total of 2310, 1849, 5271, 5947, 7710, and 6854 differentially expressed genes (DEGs) were identified compared to the control (Pp0D) in six pair-wise comparisons of treatment versus control. bHLH, NAC, ERF, MYB_related, C3H transcription factors (TFs) play an important role in drought tolerance of P. pygmaea. KEGG enrichment analysis and Gene set enrichment analysis (GSEA) analysis showed that P. pygmaea may respond to drought by enhancing metabolic processes such as ABA signaling pathway, alpha-linolenic acid. Weighted gene co-expression network analysis (WGCNA) revealed GST, CAT, LEC14B, SEC23 were associated with antioxidant enzyme activity and TAOC. This study provides a basis for further research on drought tolerance differences among coniferous species.