Abstract: To clarify the plant photosynthesis and water use characteristics among different habitats and different plant functional types, five habitats in Horqin sandy land with decreasing soil fertility were selected to represent inter-dune grassland (IDG), fixed sand dunes (FD), semi-fixed sand dunes (SFD), semi-mobile sand dunes (SMD), and mobile sand dunes (MD). The gas exchange characteristics of 35 species of shrubs and herbages (some species existed in several habitats) were measured across the five habitats. The 35 species were divided into different plant functional types according to their life forms, photosynthetic types and nitrogen-fixation characteristics. The net photosynthetic rate (P_n), water use efficiency (WUE), and intrinsic water use efficiency (WUE_i) decreased with decreasing soil N status. In addition, there were no or few differences in P_n among ILD, FD and SFD sites, and between SMD and MD sites. There was no, or few differences in WUE and WUE_i between ILD and FD sites, and among SFD, SMD and MD sites. Leaf P_n, WUE and WUE_i differed significantly among different plant functional types. Leaf P_n, WUE and WUE were higher in grasses than in herbs and shrubs grasses and shrubs. Leaf P_n, WUE and WUE_i were higher in C₄ plants than in C₃ plants, while there were no significant differences between non-legumes and legumes. Herbaceous plants, especially grasses, should be taken into account more in vegetation recovery in Horqin sandy land.