Protecting water resources for expanding human enterprise while conserving valued natural habitat is among the greatest challenges of the 21st century. Global change processes such as climate change and intensive land use pose significant threats to water resources, particularly in arid regions where potential evapotranspiration far exceeds annual rainfall. Potentially compounding these shortages is the progressive expansion of non-native plant species in riparian areas along streams, canals and rivers in geographically arid regions. This paper sets out to identify when and where non-native riparian plant species are likely to have the highest potential impact on hydrologic fluxes of arid and semiarid river systems. We develop an ecophysiological framework that focuses on two main criteria: (1) examination of the physiological traits that promote non-native species establishment and persistence across environmental gradients, and (2) assessment of where and to what extent hydrologic fluxes are potentially altered by the establishment of introduced species at varying scales from individual plants, to small river reaches, to entire river basins. We highlight three non-native plant species that currently dominate southwestern United States riparian forests. These include tamarisk (Tamarix spp.), Russian olive (Eleagnus angustifolia), and Russian knapweed (Acroptilon repens). As with other recent reviews, we suspect that in many cases the removal of these, and other non-native species will have little or no impact on either streamflow volume or groundwater levels. However, we identify potential exceptions where the expansion of non-native plant species could have significant impact on ecohydrologic processes associated with southwestern United States river systems. Future research needs are outlined that will ultimately assist land managers and policy makers with restoration and conservation priorities to preserve water resources and valued riparian habitat given limited economic resources.