The eddy covariance and energy balance method was employed to determine evapotranspiration (LE) over a wet temperate C3–C4 co-existing grassland in Japan. After sensible heat flux (H) was estimated via the eddy covariance technique, LE was calculated as the residual of the energy budget with calibration against the direct measurements of LE by a lysimeter. Daily mean LE varied from 0·8 to 10·5 MJ d−1, with a peak at 16·5 MJ d−1 in late July to early August. Day-to-day and seasonal variability in LE was affected appreciably by net radiation (Rn), atmospheric vapour pressure deficit (VPD), canopy surface conductance (gc) and leaf area index (LAI). Before the canopy closure, LE responded to LAI in a linear manner. However, LE decreased with increasing LAI later in summer. Daytime variation in the decoupling coefficient (Ω) demonstrates that the canopy decoupled from the atmosphere in the morning and LE was primarily driven by the available energy, while in the afternoon the canopy partially coupled to the atmosphere so that LE was sensitive to VPD and gc. Throughout the whole measurement period, Ω was generally larger than 0·5, suggesting that the available energy contributes more to LE than VPD. Copyright © 2004 John Wiley & Sons, Ltd.