Land use and climate changes are driving significant shifts in the magnitude and persistence of dryland stream surface flows. The impact of these shifts on ecological functioning is largely unknown, particularly where streams have become wetter rather than drier. This study investigated relationships between hydrologic regime (including surface water persistence, differences in groundwater depth and altered flooding dynamics) with plant traits and riverine vegetation functional composition. Our study system was a previously ephemeral creek in semi-arid northwest Australia that has received groundwater discharge from nearby mining operations for >15 years; surface flows are now persistent for ∼27 km downstream of the discharge point. We aimed to (i) identify plant functional groups (FGs) associated with the creek and adjacent floodplain; and (ii) assess their distribution across hydrological gradients to predict shifts in ecological functioning in response to changing flow regimes. Seven FGs were identified using hierarchical clustering of 40 woody perennial plant species based on morphometric, phenological and physiologic traits. We then investigated how FG abundance (projective foliar cover), functional composition, and functional and taxonomic richness varied along a 14 km gradient from persistent to ephemeral flows, varying groundwater depths, and distances from the stream channel. Dominant FGs were (i) drought avoidant mesic trees that are fluvial stress tolerant, or (ii) drought tolerant xeric tall shrubs that are fluvial stress intolerant. The drought avoidant mesic tree FG was associated with shallow groundwater but exhibited lower cover in riparian areas closer to the discharge (persistent surface flows). However, there were more FGs and higher species richness closer to the discharge point, particularly on the floodplain. Our findings demonstrate that quantifying FG distribution and diversity is a significant step in both assessing the impacts of mine water discharge on riverine ecosystems and for planning for post-mining restoration.