The sensitivity of several water status indicators was determined in irrigated young olive trees subjected to two drought periods at Cordoba, Spain. Trunk diameter fluctuations (TDF) were monitored continuously and stem water potential (ψ), leaf photosynthesis (P n) and conductance (g l) were measured periodically on trees where irrigation was interrupted or which were fully irrigated. During the first period of water deprivation in late spring, only some of the TDF-derived parameters were able to detect significant differences caused by water deficits, while there were no differences in stem ψ, P n and g l. All water stress indicators responded during the second drought period in midsummer. However, differences in maximum trunk diameter were detected several days before significant stem ψ differences of about 0.2 MPa were established between treatments. Stem ψ differences declined further to 0.6 MPa before differences in leaf P n and g l became significant. Of all TDF-derived indices, trunk growth rate was the most sensitive to water deficits while treatment differences in maximum daily shrinkage were insignificant in the young trees. It is concluded that continuous monitoring of trunk diameter provides the most sensitive indicator for accurate, automated irrigation scheduling of young olive trees under intensive production.