The effects of global change on ecosystem productivity and water resources in the southern United States (SUS), a traditionally ‘water-rich’ region and the ‘timber basket’ of the country, are not well quantified. We carried out several simulation experiments to quantify ecosystem net primary productivity (NPP), evapotranspiration (ET) and water use efficiency (WUE) (i.e., NPP/ET) in the SUS by employing an integrated process-based ecosystem model (Dynamic Land Ecosystem Model, DLEM). The results indicated that the average ET in the SUS was 710 mm during 1895–2007. As a whole, the annual ET increased and decreased slightly during the first and second half of the study period, respectively. The mean regional total NPP was 1.18 Pg C/yr (525.2 g C/m2/yr) during 1895–2007. NPP increased consistently from 1895 to 2007 with a rate of 2.5 Tg C/yr or 1.10 g C/m2/yr, representing a 27% increase. The average WUE was about 0.71 g C/kg H2O and increased about 25% from 1895 to 2007. The rather stable ET might explain the resulting increase in WUE. The average WUE of different biomes followed an order of: forest (0.93 g C/kg H2O) > wetland (0.75 g C/kg H2O) > grassland (0.58 g C/kg H2O) > cropland (0.54 g C/kg H2O) > shrubland (0.45 g C/kg H2O). WUE of cropland increased the fastest (by 30%), followed by shrubland (17%) and grassland (9%), while WUE of forest and wetland changed little from the period of 1895–1950 to the period of 1951–2007. NPP, ET and WUE showed substantial inter-annual and spatial variability, which was induced by the non-uniform distribution patterns and change rates of environmental factors across the SUS. We concluded that an accurate projection of the regional impact of climate change on carbon and water resources must consider the spatial variability of ecosystem water use efficiency across biomes as well as the interactions among all stresses, especially land-use and land-cover change and climate.