Tropical forest demography and dynamics were examined in three inventory plots across a precipitation gradient in central Panama. The harsh dry season of 1998 that accompanied the 1997–98 El Niño was spanned by censuses at all three sites. The wet and intermediate plots were similar in total species richness, the dry site somewhat lower in diversity; all three sites differed substantially from each other in species composition. Forest-wide growth of large trees was higher at the wet and intermediate sites than at the dry site, but sapling growth was highest at the dry site and lowest at the intermediate site. Forest-wide growth differences were reflected by individual species, for example, saplings of species at the dry site grew faster than saplings of the same species at the intermediate site. Forest-wide mortality was lowest at the dry site and highest at the wet, and this difference was also reflected by individual species. We suggest that low mortality and growth in the drier forest was due to the longer annual dry season and higher deciduousness, and that high sapling growth at the dry site was due to greater light penetration to the forest floor. Growth rates were elevated at all three sites during 1998, possibly due to reduced cloud-cover during the El Niño. Contrary to expectation, mortality during 1998 was not elevated at wet and intermediate sites during the El Niño drought, but was at the dry site. Finally, we found that some species performed poorly at one site and declined in abundance, while having stable or increasing populations at another site, demonstrating that the communities are not at equilibrium.