Exotic species continue to pose ecological problems globally. Within dynamic riverine aquatic systems, invasive woody vegetation often displaces native species or inhabits otherwise unoccupied habitats, increasing total riparian leaf area and riparian evaporative losses. Concern over implications to water resources and altered aquatic ecology has instigated field studies in southeastern Australia to quantify water use of riparian invasive Salix babylonica, Salix fragilis and native Eucalyptus camaldulenis. Spatial, temporal and species variability in transpiration and stomatal regulation were investigated using hourly sap flow measurements. We demonstrate that continuous long-term sap flow data sets can provide new insights into the hydraulic functioning of Salix spp., improving our understanding of willow water use. Wide variability in transpiration occurs across study locations, seasons, within species and with hydrological setting as stream fluctuation leads to reduced Salix transpiration, indicating a strong sensitivity to flow variability. Complex seasonal patterns of stomatal conductance (GS) and leaf level transpiration (EL) are shown for both Salix and Eucalyptus in both water limited and unlimited environments. Within both settings, Salix and Eucalyptus exhibit summer mid-day depressions in GS, with peak GS occurring before 10 am. The relationship between vapour pressure density (VPD), GS and EL yielded VPD thresholds of 3 kPa for Salix stands located within stream beds in a semi-arid climate and Eucalyptus located on both dry and saturated banks after which increasing stomatal turgor constrained transpiration, possibly to prevent xylem cavitation. A threshold of 2 kPa was identified for S. babylonica located on stream banks and S. fragilis located in-stream. Collectively, the results derived from sap flow data may provide future management options such as river height manipulation to reduce evaporative losses from Salix in Australia.