Plant water stress greatly reduces the productive capacity of the cotton plant. The primary cause of the reduced yield potential depends on when the stress occurs and the length of the growing season following recovery, but in all cases is due primarily to reduced fruit numbers rather than reduced fruit size. If stress exists during the early stages of square initiation prior to flower, potential yield is limited due to reduced numbers of second and third position fruiting sites. The inhibition of fruiting site production is highly correlated with mainstem internode elongation and provides a useful tool for monitoring the plant. The production of new mainstem nodes and first position fruiting sites is extremely tolerant of stress. If stress develops after flowering has been initiated, then young fruit abortion occurs reducing fruit numbers. The most sensitive fruit are those less than 12-14 days of age. Fruit abortion is caused primarily by lack of adequate C and N for rapid growth of the developing embryo and fruit. Leaf water status measured by leaf water potential, gas exchange or leaf temperature changes from the well-watered condition are good monitoring systems during this phase of crop development. It must be realized that all of these monitoring systems tell you that stress is already present and damage is occurring. They can not be used to predict the occurrence of stress; that can only be done by knowing the water supply and demand conditions of the crop and providing water prior to that critical water supply occurring in the soil system. This is a very site specific condition.