C4 plants are considered to be less sensitive to drought than C3 plants because of their CO2 concentrating mechanism. The C4 grasses, Paspalum dilatatum Poiret (NADP-ME), Cynodon dactylon (L.) Pers (NAD-ME) and Zoysia japonica Steudel (PEPCK) were compared in their response to water deficit imposed by the addition of polyethylene glycol to the nutrient solution in which they were grown. The effects of drought on leaf relative water content (RWC), net photosynthesis, stomatal conductance, carboxylating enzyme activities and chlorophyll a fluorescence were investigated. In C. dactylon the RWC was more sensitive, but the photosynthetic activity was less sensitive, to water deficit than in P. dilatatum and Z. japonica. The decrease of photosynthesis in P. dilatatum under water deficit was not closely related to the activities of the carboxylating enzymes or to chlorophyll a fluorescence. However, decreased activities of ribulose 1,5-bisphosphate carboxylase/oxygenase and phosphoenolpyruvate carboxylase, in addition to decreased stomatal conductance, may have contributed to the decrease of photosynthesis with drought in C. dactylon and Z. japonica. The different responses to water deficit are discussed in relation to the natural habitats of C4 grasses.