Recent decades have been characterized by increasing temperatures worldwide, resulting in an exponential climb in vapor pressure deficit (VPD). Heat and VPD has been identified as an increasingly important driver of plant functioning in terrestrial biomes and is a significant contributor to recent drought-induced tree mortality independent of other drivers associated with climate change. Despite this, few studies have isolated the physiological response of plant functioning to high VPD, heat, and soil drought, thus limiting our understanding and ability to predict future impacts on terrestrial ecosystems. In this presentation, I will discuss recent findings suggesting that high temperature and VPD can lead to a cascade of impacts, including reduced photosynthesis and growth as well as higher risks of carbon starvation and hydraulic failure, independently of soil moisture changes. I will further show how compensation mechanisms associated with shifts in phenology and species interactions may mitigate the negative impacts of rising temperature.