High air temperatures have measurable negative impacts on reproduction in wild animal populations, including during incubation in birds. Understanding the mechanisms driving these impacts requires comprehensive knowledge of animal physiology and behaviour under natural conditions. We used a novel combination of a non-invasive doubly labelled water (DLW) technique, nest temperature data and field-based behaviour observations to test effects of temperature, rainfall and group size on physiology and behaviour during incubation in southern pied babblers Turdoides bicolor, a cooperatively breeding passerine endemic to the arid savanna regions of southern Africa. The proportion of time that clutches were incubated declined as air temperatures increased, a behavioural pattern traditionally interpreted as a benefit of ambient incubation. However, we show that (i) clutches had a <50% chance of hatching when exposed to daily maximum air temperatures of >35.3°C; (ii) pied babbler groups incubated their nests almost constantly (99% of daylight hours) except on hot days; (iii) operative temperatures in unattended nests frequently exceeded 40.5°C, above which bird embryos are at risk of death; (iv) pied babblers incubating for long periods of time failed to maintain water balance on hot days; and (v) pied babblers from incubating groups lost mass on hot days. These results suggest that pied babblers might leave their nests during hot periods to lower the risk of dehydration associated with prolonged incubation at high operative temperatures. As mean air temperatures increase and extreme heat events become more frequent under climate change, birds will likely incur ever greater thermoregulatory costs of incubation, leading to compromised nest attendance and increased potential for eggs to overheat, with implications for nest success and, ultimately, population persistence.