Water availability is the most limiting factor to global plant productivity, yet photosynthetic responses to seasonal drought cycles are poorly understood, with conflicting reports on which limiting process is the most important during drought. We address the problem using a model-data synthesis approach to look at canopy level fluxes, integrating twenty years of half hour data gathered by the FLUXNET network across six Mediterranean sites. The measured canopy level, water and carbon fluxes were used, together with an inverse canopy ecophysiological model, to estimate the bulk canopy conductance, bulk mesophyll conductance, and the canopy scale carbon pools in both the intercellular spaces and at the site of carboxylation in the chloroplasts. Thus the roles of stomatal and mesophyll conductance in the regulation of internal carbon pools and photosynthesis could be separated. A quantitative limitation analysis allowed for the relative seasonal responses of stomatal, mesophyll, and biochemical limitations to be gauged. The concentration of carbon in the chloroplast was shown to be a potentially more reliable estimator of assimilation rates than the intercellular carbon concentration. Both stomatal conductance limitations and mesophyll conductance limitations were observed to regulate the response of photosynthesis to water stress in each of the six species studied. The results suggest that mesophyll conductance could bridge the gap between conflicting reports on plant responses to soil water stress, and that the inclusion of mesophyll conductance in biosphere–atmosphere transfer models may improve their performance, in particular their ability to accurately capture the response of terrestrial vegetation productivity to drought.