Drought is a critical factor in plant species distributions. Much research points to its relevance even in moist tropical regions. Recent studies have begun to elucidate mechanisms underlying the distributions of tropical tree species with respect to drought; however, how such desiccation tolerance mechanisms correspond with the coordination of hydraulic and photosynthetic traits in determining species distributions with respect to rainfall seasonality deserves attention. In the present study, we used a common garden approach to quantify inherent differences in wood anatomical and foliar physiological traits in 21 tropical tree species with either widespread (occupying both seasonal and aseasonal climates) or southern (restricted to aseasonal forests) distributions with respect to rainfall seasonality. Use of congeneric species pairs and phylogenetically independent contrast analyses allowed examination of this question in a phylogenetic framework. Widespread species opted for wood traits that provide biomechanical support and prevent xylem cavitation and showed associated reductions in canopy productivity and consequently growth rates compared with southern species. These data support the hypothesis that species having broader distributions with respect to climatic variability will be characterized by traits conducive to abiotic stress tolerance. This study highlights the importance of the well-established performance vs. stress tolerance trade-off as a contributor to species distributions at larger scales.