Eucalyptus cladocalyx, known for its drought tolerance, has complex wood anatomy influenced by environmental conditions. This study investigated the xylem response of E. cladocalyx seedlings to cyclic drought stress compared to continuous irrigation. Seedlings were subjected to alternating drought and watering cycles, and their growth, xylem traits and cambial activity were monitored. Continuously irrigated seedlings exhibited greater height and stem diameter growth than periodically irrigated ones. Xylem response between the periodic and continuous irrigations showed no significant differences. Vessel and fibre features showed significant temporal variation, with substantial interaction between treatment and time for vessel area, fibre area and fibre thickness and not for vessel frequency. The cambium remained active under drought conditions, indicating resilience. Overall, anatomical properties varied complexly and inconsistently across drought cycles, likely due to differences in drought intensity, strategies and genetic factors.