[Truncated abstract] Establishment of vegetation and ecosystem functioning is central to the mitigation of environmental impacts associated with mining operations. This study investigated the ecophysiological functioning of mature plants in natural vegetation and applied this knowledge to diagnose problems affecting plant health and causes of poor plant cover at a mine-rehabilitation site. Ecophysiological parameters, including plant water relations and mineral nutrition, were studied in conjunction with soil physical, hydraulic and chemical properties. The natural ecosystem at the study location in the Great Sandy Desert is characterised by sand dunes and interdunes with distinct plant communities on each. One of the most notable features of the vegetation is the presence of large Corymbia chippendalei trees high on the dunes and relatively small scattered shrubs in the interdunes. Triodia grasses (spinifex), dominate the vegetation in both habitats but different species occur in each; T. schinzii is restricted entirely to the dunes, and T. basedowii occurs only in the interdunes. It was hypothesised that the deep sandy dunes afford greater water availability but lower nutrient supply to plants in this habitat compared with those occurring in the lower landscape position of the interdunes. Water-relations parameters (leaf water potentials, stomatal conductance, d13C) revealed that dune plants, particularly woody species, displayed higher water status and water use than closely related and often congeneric plants in the interdunes. Nutrient concentrations in soils were significantly higher in the interdunes, but concentrations in foliage were similar for related species between habitats. It is concluded that the dunes provide a greater store of accessible water than the soil profile in the interdunes. ... Following an experimental wetting pulse equivalent to a summer cyclone event, A. ancistrocarpa plants displayed significant increases in stomatal conductance, leaf water potential and sap velocity in lateral roots within three days of irrigation at the natural site and two days at the rehabilitation site. Secondary sinker roots originating from distal sections of lateral roots were evidently supplying water to maintain hydraulic function in laterals, thus enabling a fast pulse response. This was accentuated at the rehabilitation site where roots were confined closer to the surface. These results indicate that plants at the rehabilitation site are more dependent on small pulses of water and have less access to deep reserves than plants at the natural site. It is concluded that high runoff losses and insufficient soil depth are major factors contributing to plant water stress, and combined with the direct impacts of erosion, are largely responsible for plant death and ultimately poor plant cover. These issues can be alleviated if cover soil depth is increased to more than 0.5 m and slope angles are reduced to <12o. This study demonstrates the value of an ecophysiological approach for diagnosing problems affecting plant establishment at mine-rehabilitation sites. Furthermore, it has provided recommendations that will improve the rehabilitation strategy and lead to the development of a well vegetated, resilient ecosystem on a stable and non-polluting land form.