Professor Farquhar has made outstanding theoretical and experimental advances in research in carbon and water relations of plants. Using optimisation theory, he has contributed to a new description of the regulation of CO2 uptake in relation to water loss. He has developed models of photosynthetic metabolism that predict rate of CO2 uptake as a function of physical environment. He has shown how carbon-isotope composition of plant tissue depends on biochemical and diffusional limitations to CO2 uptake, and variation in composition amongst plants in a given environment reflects variation in water-use efficiency. This has led to a promising technique for selecting crop-plant varieties for water-limited environments.