Vegetation plays a central role in controlling terrestrial carbon (C) exchange, but quantifying its impacts on C cycling on time scales of ecological succession is hindered by a lack of long-term observations. The net ecosystem exchange of carbon (NEE) was measured for several years in adjacent ecosystems that represent distinct phases of ecological succession in the southeastern USA. The experiment was designed to isolate the role of vegetation – apart from climate and soils – in controlling biosphere–atmosphere fluxes of CO2 and water vapor. NEE was near zero over 5 years at an early successional old-field ecosystem (OF). However, mean annual NEE was nearly equal, approximately −450 g C m−2 yr−1, at an early successional planted pine forest (PP) and a late successional hardwood forest (HW) due to the sensitivity of the former to drought and ice storm damage. We hypothesize that these observations can be explained by the relationships between gross ecosystem productivity (GEP), ecosystem respiration (RE) and canopy conductance, and long-term shifts in ecosystem physiology in response to climate to maintain near-constant ecosystem-level water-use efficiency (EWUE). Data support our hypotheses, but future research should examine if GEP and RE are causally related or merely controlled by similar drivers. At successional time scales, GEP and RE observations generally followed predictions from E. P. Odum's ‘Strategy of Ecosystem Development’, with the surprising exception that the relationship between GEP and RE resulted in large NEE at the late successional HW. A practical consequence of this research suggests that plantation forestry may confer no net benefit over the conservation of mature forests for C sequestration.