ABSTRACTVegetation plays a central role in forming and maintaining an ecosystem's physical conditions, which in turn strongly influence vegetation function. These bidirectional feedbacks may be particularly evident during an ecosystem succession following large‐scale disturbances. Clay settling areas (CSAs) are large elevated impoundments that receive clay slurry as a by‐product of phosphate mining in Florida. As CSAs mature, a limited seed source arrests ecological succession, resulting in the dominance of Salix caroliniana, which is likely further supported by altered abiotic conditions. The dominance of this wetland pioneer species and its interactions with soil and hydrology may largely determine the future ecosystem state. To identify how interactions between groundwater levels, soil water availability, and vegetation response regulate the succession of CSA ecosystems, we measured groundwater levels, vertical soil moisture profiles, soil water potentials, and root biomass allocation and transpiration of S. caroliniana at two sites. Fine soil texture in the CSAs resulted in capillary fringe heights greater than 1 m, which maintained soil moisture near saturation well above the water table. Rooting depths over 1 m in the clay soils provided sufficient water availability, which, along with high residual phosphorus concentrations, explained the dominance and high transpiration rates of S. caroliniana across CSAs. Capillary rise‐induced water availability created wetland soil conditions far upgradient from inundated areas, underscoring the role of soil texture in determining wetland extent. The strong coupling between water table and S. caroliniana transpiration, however, suggests that beyond soil development, this pioneer phreatophyte may also drive succession through systematic dewatering. Copyright © 2011 John Wiley & Sons, Ltd.