Grasses are cosmopolitan, existing in many biome and climate types from xeric to tropical. Traits that control physiological responses to drought vary strongly among grass lineages, suggesting that tolerance strategies may differ with evolutionary history. Here, we withheld water from 12 species representing 6 tribes of grasses to compare how tolerant and intolerant species respond to drought in different grass lineages. We measured physiological, morphological, and microanatomical traits. Dominant lineages from tropical savannas, like Andropogoneae, tolerated drought due to above and belowground morphological traits, while temperate grasses utilized conservative leaf physiology (gas exchange) and microanatomy. Increased intrinsic water-use efficiency (iWUE) coincided with a larger number of stomata, resulting in greater water loss (with inherently greater carbon gain) and increased drought sensitivity. Inherent leaf and root economic strategies impacting drought response were observed in all species, resulting in either high SLA or SRL, but not both. Our results indicate that grasses subjected to severe drought were influenced by microanatomical traits (e.g., number of stomata and xylem area) which were shared within lineages. In addition, grasses recovered at least 50% of physiological functioning across all lineages and 92% within Andropogoneae species, illustrating how drought can influence functional responses across diverse grass lineages.