The hypothesis that vegetation adapts optimally to its environment gives rise to a novel framework for modeling the interactions between vegetation dynamics and the catchment water balance that does not rely on prior knowledge about the vegetation at a particular site. We present a new model based on this framework that includes a multilayered physically based catchment water balance model and an ecophysiological gas exchange and photosynthesis model. The model uses optimization algorithms to find those static and dynamic vegetation properties that would maximize the net carbon profit under given environmental conditions. The model was tested at a savanna site near Howard Springs (Northern Territory, Australia) by comparing the modeled fluxes and vegetation properties with long-term observations at the site. The results suggest that optimality may be a useful way of approaching the prediction and estimation of vegetation cover, rooting depth, and fluxes such as transpiration and CO2 assimilation in ungauged basins without model calibration.