By regulating carbon uptake and water loss by plants, stomata are not only responsible for productivity but also survival during drought. The timing of the onset of stomatal closure is crucial for preventing excessive water loss during drought, but is poorly explained by plant hydraulics alone and what triggers stomatal closure remains disputed. We investigated whether the hormone abscisic acid (ABA) was this trigger in a highly embolism-resistant tree species Umbellularia californica. We tracked leaf ABA levels, determined the leaf water potential and gravimetric soil water content (gSWC) thresholds for stomatal closure and transpiration decline during a progressive drought. We found that U. californica plants have a peaking-type ABA dynamic, where ABA levels rise early in drought and then decline under prolonged drought conditions. The early increase in ABA levels correlated with the closing of stomata and reduced transpiration. Furthermore, we found that transpiration declined before any large decreases in predawn plant water status and could best be explained by transient drops in midday water potentials triggering increased ABA levels. Our results indicate that ABA-mediated stomatal regulation may be an integral mechanism for reducing transpiration during drought before major drops in bulk soil and plant water status.