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The balance between stomatal and mesophyll conductance has been reported to directly influence intrinsic water-use efficiency (WUEi), but it is unclear whether variations in stomatal and mesophyll limitations (lsc and lm, respectively) affect WUEi during soil drought and rewatering. Limitations (lsc, lm and biochemical limitation, lb) and WUEi were measured in Manchurian ash (Fraxinus mandshurica Rupr.) and Mongolian oak (Quercus mongolica Fish. ex Ledeb) saplings exposed to two levels of water stress (moderate and severe) and rewatering in this study. The primary limiting factors for photosynthesis among lsc, lm, and lb and their correlations with WUEi were assessed. Both lsc and lm increased with water stress, while lb decreased, and during recovery, lsc and lm decreased, while lb increased. Photosynthesis limitations directly influenced WUEi, with WUEi being larger after rewatering than during water stress, increasing as biochemical capacity weakened at the expense of diffusional limitations (lsc and lm). Stomatal closure was more limiting to net photosynthesis in Mongolian oak than in Manchurian ash during the drought and recovery treatments; consistently higher WUEi was measured in the former species, possibly due to a more developed root system and larger leaf hydraulic conductance and stem vessel diameter in the former species.