Abstract Forest decline under environmental stress is expressed by regeneration failure and accelerated mortality in all ontogenic stages at the population level. Characterizing functional traits and mechanisms that best capture species decline and mortality is essential to assess forest dynamics. We analysed sensitivity to increasing water stress in two species with different water‐use strategies on a mixed Quercus pyrenaica–Pinus sylvestris forest where adult pines express vulnerability to climate change but oaks do not. We compared the dynamics of radial growth, wood δ13C and sapwood non‐structural carbohydrates (NSCs) in response to drought at different time‐scales in both species and two age cohorts in pine. Both species were very sensitive to water stress, which influenced trait phenotypic plasticity at short‐ and long time‐scales. Water‐use strategy in pines of both ages was more conservative than in the more drought‐tolerant oak. Both species showed negative growth trends despite increasing intrinsic water‐use efficiency. Recent growth of pines is slower than it was in the past. Carbon isotope discrimination trends in young pines suggested increasing leaf gas exchange constraints. NSCs were far from depletion in both species and all pine ages. Intra‐ and inter‐annual NSC variability was higher in oaks than in pines and in soluble sugars (SS) than in starch. SS were lowest in young pines. Sensitivity of NSCs to contrasting climatic years was low in pines, and NSC levels mostly remained homeostatic for this species. The sensitivity to climate expressed suggests different C allocation strategies, with less coupling between radial growth and current‐year photosynthesis in young pines. Synthesis. Pines expressed negative responses to increased water stress regardless of age, showing rising gas exchange constraints through tighter stomatal control of water losses than oaks. Young pines showed similar functional responses to water stress than old pines in decline, which suggests species‐level vulnerability and could be regarded as early warning signals anticipating mortality in pines. Yet, given the high sensitivity to drought also expressed by the non‐declining oak, it would have been difficult to unequivocally disentangle species decline based only on the functional traits analysed.