Native tallgrass prairie in NE Kansas was exposed to elevated (twice ambient) or ambient atmospheric CO2 levels in open-top chambers. Within chambers or in adjacent unchambered plots, the dominant C4 grass, Andropogon gerardii, was subjected to fluctuations in sunlight similar to that produced by clouds or within canopy shading (full sun > 1500 μmol m−2 s−1 versus 350 μmol m−2 s−1 shade) and responses in gas exchange were measured. These field experiments demonstrated that stomatal conductance in A. gerardii achieved new steady state levels more rapidly after abrupt changes in sunlight at elevated CO2 when compared to plants at ambient CO2. This was due primarily to the 50% reduction in stomatal conductance at elevated CO2, but was also a result of more rapid stomatal responses. Time constants describing stomatal responses were significantly reduced (29–33%) at elevated CO2. As a result, water loss was decreased by as much as 57% (6.5% due to more rapid stomatal responses). Concurrent increases in leaf xylem pressure potential during periods of sunlight variability provided additional evidence that more rapid stomatal responses at elevated CO2 enhanced plant water status. CO2-induced alterations in the kinetics of stomatal responses to variable sunlight will likely enhance direct effects of elevated CO2 on plant water relations in all ecosystems.