Photosynthetic and transpiration (E) rates, stomatal conductance, and leaf nitrogen content were surveyed for Myrica gale var. tomentosa, a N2-fixing wetland shrub, Betula platyphylla var. japonica, and Rhododendron japonicum in Ozegahara moor, an oligotrophic moor in Central Japan. Net photosynthetic rate saturated with irradiance (Pmax) of M. gale was 15.2-16.5 μmol(CO2) m-2 s-1, higher than those of the other species throughout the growing season. Pmax was positively correlated with leaf N content among the three species. The large leaf N content in M. gale was due to N2-fixation in root nodules. In a comparison of M. gale in two habitats, Pmax, leaf N content, and root nodule development were larger in the wetter habitat. M. gale showed high E and no midday depression of Pmax even under high irradiance and large vapour pressure deficit between leaves and ambient air on a midsummer day. These traits of photosynthesis and water relations were associated with the dominance of this shrub in wetter sites such as stream sides and hollows. and K, Maeda ... [et al.].