The leaf-specific hydraulic conductivity (K-L) of plant stems call control leaf water supply. This property is influenced by variation in leaf/sapwood area ratio (A(L)/A(S)) and the specific hydraulic conductivity of xylem tissue (K-S), In environments with high atmospheric vapor pressure deficit (VPD), K-L may increase to support higher transpiration rates. We predicted that saplings of Acer rubrum and A. pensylvanicum grown in forest canopy gaps, under high light and VPD, would have higher K-L and lower A(L)/A(S) than similar sized saplings in the understory. Leaf-specific hydraulic conductivity and K-S increased with sapling size for both species. In A. rubrum, K-S did not differ between the two environments but lower A(L)/A(S) (p = 0.05, ANCOVA) led to higher K-L for gap-grown saplings (P < 0.05, ANCOVA). In A. pensylvanicum, neither K-S, A(L)/A(S), K-L differed between environments. In a second experiment, we examined the impact of sapling size on the water relations and carbon assimilation of A. pensylvanicum. Maximum stomatal conductance for A. pensylvanicum increased with K-L (r(2) = 0.75, P < 0.05). A hypothetical large A. pensylvanicum sapling (2 m tall) had 2.4 times higher K-L and 23 times greater daily carbon assimilation than a small (Im tall) sapling. Size-related hydraulic limitations in A. pensylvanicum caused a 68% reduction in daily carbon assimilation in small saplings. Mid-day water potential increased with A. pensylvanicum I sapling size (r(2) = 0.69, P < 0.05). Calculations indicated that small A. pensylvanicum saplings (low K-L) could not transpire at the rate of large saplings (high K-L) without reaching theoretical thresholds for xylem embolism induction. The coordination between K-L and stomatal conductance in saplings may prevent xylem water potential from reaching levels that cause embolism but also limits transpiration. The K-S of the xylem did not vary across environments, suggesting that altering biomass allocation is the primary mechanism of increasing K-L However, the ability to alter aboveground biomass allocation in response to canopy gaps is species-specific. As a result of the increase in K-L and K-S with sapling size for both species, hydraulic limitation of water flux may impose a greater restriction on daily carbon assimilation for small saplings in the gap environment.