Differentiation in physiological activity is a critical component of resource partitioning in resource-limited environments. For example, it is crucial to understand how plant physiological performance varies through time for different functional groups to forecast how terrestrial ecosystems will respond to change. Here, we tracked the seasonal progress of 13 plant species representing C₃ shrub, perennial C₃ and C₄ grass, and annual forb functional groups of the Colorado Plateau, USA. We tested for differences in carbon assimilation strategies and how photosynthetic rates related to recent, seasonal, and annual precipitation and temperature variables. Despite seasonal shifts in species presence and activity, we found small differences in seasonally weighted annual photosynthetic rates among groups. However, differences in the timing of maximum assimilation (A_net) were strongly functional group-dependent. C₃ shrubs employed a relatively consistent, low carbon capture strategy and maintained activity year-round but switched to a rapid growth strategy in response to recent climate conditions. In contrast, grasses maintained higher carbon capture during spring months when all perennials had maximum photosynthetic rates, but grasses were dormant during months when shrubs remained active. Perennial grass A_net rates were explained in part by precipitation accumulated during the preceding year and average maximum temperatures during the past 48 h, a result opposite to shrubs. These results lend insight into diverse physiological strategies and their connections to climate, and also point to the potential for shrubs to increase in abundance in response to increased climatic variability in drylands, given shrubs’ ability to respond rapidly to changing conditions.