Tropical forests hold large stocks of carbon in biomass and face pressures from changing climate and anthropogenic disturbance. Forests' capacity to store biomass under future conditions and accumulate biomass during regrowth after clearance are major knowledge gaps. Here we use chronosequence data, satellite observations and a C-cycle model to diagnose woody C dynamics in two dry forest ecotypes (semi-deciduous and semi-evergreen) in Yucatán, Mexico. Woody biomass differences between mature semi-deciduous (90 MgC ha−1) and semi-evergreen (175 MgC ha−1) forest landscapes are mostly explained by differences in climate (c. 60%), particularly temperature, humidity and soil moisture effects on production. Functional variation in foliar phenology, woody allocation, and wood turnover rate explained c. 40% of biomass differences between ecotypes. Modeling experiments explored varied forest clearance and regrowth cycles, under a range of climate and CO2 change scenarios to 2100. Production and steady state biomass in both ecotypes were reduced by forecast warming and drying (mean biomass 2021–2100 reduced 16–19% compared to 2001–2020), but compensated by fertilisation from rising CO2. Functional analysis indicates that trait adjustments amplify biomass losses by 70%. Experiments with disturbance and recovery across historically reported levels indicate reductions to mean forest biomass stocks over 2021–2100 similar in magnitude to climate impacts (10–19% reductions for disturbance with recovery). Forest disturbance without regrowth amplifies biomass loss by three- or four-fold. We conclude that vegetation functional differences across the Yucatán climate gradient have developed to limit climate risks. Climate change will therefore lead to functional adjustments for all forest types. These adjustments are likely to magnify biomass reductions caused directly by climate change over the coming century. However, the range of impacts of land use and land use change are as, or more, substantive than the totality of direct and indirect climate impacts. Thus the carbon storage of Yucatan's forests is highly vulnerable both to climate and land use and land use change. Our results here should be used to test and enhance land surface models use for dry forest carbon cycle assessment regionally and globally. A single plant functional type approach for modeling Yucatán's forests is not justified.