Abstract: There is a strong natural light gradient from the top to the bottom in plant canopies and along gap-understorey continua. Leaf structure and photosynthetic capacities change close to proportionally along these gradients, leading to maximisation of whole canopy photosynthesis. However, other environmental factors also vary within the light gradients in a correlative manner. Specifically, the leaves exposed to higher irradiance suffer from more severe heat, water, and photoinhibition stresses. Research in tree canopies and across gap-understorey gradients demonstrates that plants have a large potential to acclimate to interacting environmental limitations. The optimum temperature for photosynthetic electron transport increases with increasing growth irradiance in the canopy, improving the resistance of photosynthetic apparatus to heat stress. Stomatal constraints on photosynthesis are also larger at higher irradiance because the leaves at greater evaporative demands regulate water use more efficiently. Furthermore, upper canopy leaves are more rigid and have lower leaf osmotic potentials to improve water extraction from drying soil. The current review highlights that such an array of complex interactions significantly modifies the potential and realized whole canopy photosynthetic productivity, but also that the interactive effects cannot be simply predicted as composites of additive partial environmental stresses. We hypothesize that plant photosynthetic capacities deviate from the theoretical optimum values because of the interacting stresses in plant canopies and evolutionary trade-offs between leaf- and canopy-level plastic adjustments in light capture and use.