The Araucariaceae is an iconic tree family. Once globally important, the Araucariaceae declined dramatically over the Cenozoic period. Increasing aridity is thought to be responsible for extinction and range contraction of Araucariaceae in Australia, yet little is known about how these trees respond to water stress. We examined the response to water stress of the recently discovered tree Wollemia nobilis Jones, W.G., Hill, K.D. & Allen, J.M. (Araucariaceae) and two closely related and widespread tree species, Araucaria bidwillii Hook. and Araucaria cunninghamii Mudie, and the island-endemic species, Araucaria heterophylla (Salisb.) Franco. Leaf water potential in all Araucaria spp. remained remarkably unchanged during both dehydration and rehydration, indicating strong isohydry. The xylem tensions at which shoot and stem hydraulic conductances were reduced to 50% (P50shoot and P50stem) were closely correlated in all species. Among the four species, W. nobilis exhibited greater resistance to xylem hydraulic dysfunction during water stress (as indicated by P50shoot and P50stem). Unexpectedly, W. nobilis also experienced the highest levels of crown mortality in response to dehydration, suggesting that this was the most drought-sensitive species in this study. Our results highlight that single traits (e.g., P50) should not be used in isolation to predict drought survival. Further, we found no clear correlation between species’ P50 and rainfall across their distributional range. Diversity in drought response among these closely related Araucariaceae species was surprisingly high, considering their reputation as a functionally conservative family.