Woody plants vary greatly from tall trees to branching shrubs with increasing dryness. Variations in plant allometry are driven by both biotic and abiotic factors, reflecting different plant adaption strategies in different environments. While much is known about the response of plant functional traits to declining rainfall, less is known about how aboveground allometry (e.g. canopy size, height, stems, branching) of woody plants might respond to increasing dryness, limiting our ability to predict changes in woody plants and associated ecosystem functions under future climate change scenarios. Here, we explore how aboveground allometry of different woody genera responds to increasing dryness at 150 sites long an extensive aridity gradient from humid to arid areas. We used regression analyses and Structural Equation Modelling to explore the variation in woody allometry with increasing aridity, and the abiotic (resource availability) and biotic (competition) mechanisms driving such changes. Our results showed that plant height declined, but branching, and canopy width and depth increased with increasing aridity. Woody responses to dryness varied among genera, with increasing aridity associated with wider canopies in Eucalyptus and Callitris, thicker stems in Acacia, but no clear differences in Allocasuarina. Biotic and abiotic factors exerted different effects on the allometry of different genera, with Eucalyptus and Callitris spp. constrained by resource availability, while Acacia and Allocasuarina spp. were regulated mainly by competition. Our results highlight the genus-specific responses in allometric changes and driving mechanisms (resource availability cf. competition) with increasing dryness. Rather than merely shrinking, plants would allocate resources to either canopies or stems to cope with increasing dryness. Under predicted hotter and drier climates, increasing stem or canopy size, and altering branching might be a useful strategy for woody plants to compensate for biomass reduction and maintain ecosystem functions while growing shorter as dryness increases.