Summer droughts are likely to increase in frequency and intensity across Europe, yet long-lived trees may have a limited ability to tolerate drought. It is therefore critical that we improve our understanding of phenotypic plasticity to drought in natural populations for ecologically and economically important trees such as Populus nigra L. A common garden experiment was conducted using ∼500 wild P. nigra trees, collected from 11 river populations across Europe. Phenotypic variation was found across the collection, with southern genotypes from Spain and France characterized by small leaves and limited biomass production. To examine the relationship between phenotypic variation and drought tolerance, six genotypes with contrasting leaf morphologies were subjected to a water deficit experiment. North eastern genotypes were collected at wet sites and responded to water deficit with reduced biomass growth, slow stomatal closure and reduced water use efficiency (WUE) assessed by Δ(13)C. In contrast, southern genotypes originating from arid sites showed rapid stomatal closure, improved WUE and limited leaf loss. Transcriptome analyses of a genotype from Spain (Sp2, originating from an arid site) and another from northern Italy (Ita, originating from a wet site) revealed dramatic differences in gene expression response to water deficit. Transcripts controlling leaf development and stomatal patterning, including SPCH, ANT, ER, AS1, AS2, PHB, CLV1, ERL1-3 and TMM, were down-regulated in Ita but not in Sp2 in response to drought.