Maintenance of water transport is very important for plant growth and survival. We studied seven woody species that inhabit the semi-arid Mu Us Sandy Land, China, to understand their strategies for maintaining hydraulic function. We evaluated water transport properties, including cavitation resistance, hydraulic recovery, and water loss regulation by stomatal control, which are associated with xylem structural and leaf physiological traits. We also discussed the water-use characteristics of these species by comparing them with those of species in other regions. Species with tracheids had higher levels of xylem resistance to cavitation and a smaller midday transpiration rate than the other species studied. Although species with vessels were less resistant to cavitation, some recovered hydraulic conductivity within 12 h of rehydration. Species with xylem tracheids could maintain their hydraulic function through resistance to cavitation and by relaxing xylem tension. Although species with vessels had less resistant xylem, they could maintain hydraulic function through hydraulic recovery even when xylem dysfunction occurred. Additionally, the species studied here were less resistant to cavitation than species in semi-arid environments, and equally or less resistant than species in humid environments. Rather than allow hydraulic dysfunction due to drought-induced dehydration, they may develop water absorption systems to avoid or recover quickly from hydraulic dysfunction. Thus, not only stem cavitation resistance to drought but also stem-root coordination should be considered when selecting plants for the revegetation of arid regions.