Establishing vegetation on disturbed sites in arid environments is difficult due to decreased water availability caused by altered soil properties: depth, compaction, and hydraulic characteristics. Plants cope with moisture stress through a combination of traits, including physiological strategies such as anisohydry and isohydry. We used a typical mine restoration substrate in a glasshouse pot experiment to investigate drought tolerance of nine Pilbara region Acacia species classified according to habitat preferences defined by preferred soil type: alluvial (fine textured), sandy, rocky, and generalists without a clear soil preference. Seedlings were examined to (1) determine physiological shoot, and morphological shoot and root traits associated with drought tolerance, and (2) identify if these traits were correlated with species' soil preferences. Species from alluvial, rocky, and one sandy soil species were more anisohydric. These species had higher stomatal conductance at more negative leaf water potentials. Alluvial soil species had greater total biomass allocation to lateral roots, whereas two coarser textured soil species had high allocation to tap roots. Soil preference was a poor predictor of plant water relations, presumably due to complex soil profiles in nature associated with widely differing hydraulic characteristics, and interactions among plant functional traits influencing water uptake, transport and loss.