Abstract Wood density (WD) is often used as a proxy for hydraulic traits such as vulnerability to drought-induced xylem cavitation and maximum water transport capacity, with dense-wooded species generally being more resistant to drought-induced xylem cavitation, having lower rates of maximum water transport and lower sapwood capacitance than light-wooded species. However, relationships between WD and the hydraulic traits that they aim to predict have not been well established in tropical forests, where modeling is necessary to predict drought responses for a high diversity of unmeasured species. We evaluated WD and relationships with stem xylem vulnerability by measuring cavitation curves, sapwood water release curves and minimum seasonal water potential (Ψmin) on upper canopy branches of six tree species and three liana species from a single wet tropical forest site in Panama. The objective was to better understand coordination and trade-offs among hydraulic traits and the potential utility of these relationships for modeling purposes. We found that parameters from sapwood water release curves such as capacitance, saturated water content and sapwood turgor loss point (Ψtlp,x) were related to WD, whereas stem vulnerability curve parameters were not. However, the water potential corresponding to 50% loss of hydraulic conductivity (P50) was related to Ψtlp,x and sapwood osmotic potential at full turgor (πo,x). Furthermore, species with lower Ψmin showed lower P50, Ψtlp,x and πo,x suggesting greater drought resistance. Our results indicate that WD is a good easy-to-measure proxy for some traits related to drought resistance, but not others. The ability of hydraulic traits such as P50 and Ψtlp,x to predict mortality must be carefully examined if WD values are to be used to predict drought responses in species without detailed physiological measurements.