In the literature, contrasting effects of plant species richness on the soil water balance are reported. Our objective was to assess the effects of plant species and functional richness and functional identity on soil water contents and water fluxes in the experimental grassland of the Jena Experiment. The Jena Experiment comprises 86 plots on which plant species richness (0, 1, 2, 4, 8, 16, and 60) and functional group composition (zero to four functional groups: legumes, grasses, tall herbs, and small herbs) were manipulated in a factorial design. We recorded meteorological data and soil water contents of the 0·0–0·3 and 0·3–0·7 m soil layers and calculated actual evapotranspiration (ETa), downward flux (DF), and capillary rise with a soil water balance model for the period 2003–2007. Missing water contents were estimated with a Bayesian hierarchical model. Species richness decreased water contents in subsoil during wet soil conditions. Presence of tall herbs increased soil water contents in topsoil during dry conditions and decreased soil water contents in subsoil during wet conditions. Presence of grasses generally decreased water contents in topsoil, particularly during dry phases; increased ETa and decreased DF from topsoil; and decreased ETa from subsoil. Presence of legumes, in contrast, decreased ETa and increased DF from topsoil and increased ETa from subsoil. Species richness probably resulted in complementary water use. Specific functional groups likely affected the water balance via specific root traits (e.g. shallow dense roots of grasses and deep taproots of tall herbs) or specific shading intensity caused by functional group effects on vegetation cover. Copyright © 2013 John Wiley & Sons, Ltd.