Xylem-tapping mistletoes are known to have generally higher transpiration rate (Tr), lower CO2 assimilation rate (A) and therefore lower water-use efficiency (WUE) than their hosts. There are long-standing contradictions in water relations and nitrogen use in photosynthesis. Gas exchange, chlorophyll fluorescence and nutrition components were investigated in a special mistletoe-host pair, Viscum ovalifolium-Sonneratia caseolaris, as the host was a mangrove growing in a saline environment. Our results show that both plants had high foliar N content, therefore it was consistent with the N-parasitism hypothesis, although the mistletoe had a lower Tr than its mangrove host. It was suggested that the mistletoe reduces its Tr under salt stress with N sufficient conditions. The mistletoe had a fundamental limitation of photosynthesis, and was photoinhibited with regard to high salinity, but it developed more photoprotection to thermal radiation. Additionally, both stomatal conductance (gs) and mesophyll conductance (gm) limitations on photosynthesis dominated in the mistletoe under salt stress even though it had a high foliar N content similar to the host.