Specific leaf area (SLA) is an important leaf attribute representing a compromise between the capture of light and CO2 and the limitations imposed by leaf structure, herbivore resistance and the mitigation of water loss. We examined three Eucalyptus L'Her. species to determine whether variation in CO2 assimilation rate was related to SLA and leaf anatomy. Seedlings were grown in a naturally illuminated glasshouse with adequate water and nutrients. Light-saturated rates of photosynthesis were measured on the youngest fully expanded leaves. Mesophyll characteristics were measured from sections thick of the interveinal leaf lamina. Significant interspecies variation in SLA corresponded to clear trends in anatomy and photosynthesis. Low-SLA leaves were thicker, having increased thickness of palisade mesophyll because of a greater number of palisade layers. E. occidentalis, E. camaldulensis and E. grandis had 3.7, 2.0 and 1.0 layers of palisade cells which corresponded to an SLA of 14.8, 17.6 and 21.8 m2 kg-1, respectively. High investment of dry mass in photosynthetic tissue was associated with higher leaf N (area and mass) concentration, chlorophyll concentration and photosynthetic capacity per leaf area. Leaf morphology affected use of the resources N, water and CO2. In contrast to the thin leaves of E. grandis, thick leaves of E. occidentalis had low N-use efficiency and high instantaneous water-use efficiency. Differences in leaf structure of these species appear to reflect the most limiting resource experienced in the environments to which they have adapted. ɫ CSIRO 2002.