Several studies have demonstrated that topography, as a proxy for resource availability, plays an important role in shaping tree species distribution patterns in tropical forests. Here we take a functional approach by assessing changes in plant functional traits along topographical gradients in a 20-ha forest dynamics plot in Xishuangbanna, southern Yunnan, China. We hypothesized that observed changes in trait composition and diversity along the topographic gradient should reflect tree life-history strategies linked to resource (water and nutrients) availability. We measured and compiled data of the maximum height, leaf area, seed mass and wood density of 334 tree species in 500 subplots (20 [1] 20 m). We found that species composition and diversity changed significantly along the topographical gradient. This change was accompanied by increasing community average seed mass and wood density, and decreasing leaf area and tree maximum height with higher elevations and steeper slopes. Higher slopes and ridges were being dominated by tree communities that, possibly due to environmental filtering, converged on a combination of traits characteristic of slow growth and low turn-over. Lower slopes and valleys, on the other hand, were dominated by tree communities that showed high trait evenness and divergence, and tree species characterized by traits indicative of fast growth and turn-over, i.e. competition for resources may be responsible for complementary trait combinations and resource use in this habitat type. Our study shows that functional traits can provide a mechanistic understanding of the processes shaping tropical tree community assembly along topographical gradients and supplements information obtained using species composition and diversity data. Some practical outcomes of our study include: (1) plant species compositional trends in tropical forests can be predicted with GIS technology, focusing on topographical gradients; (2) forest communities on ridges may become more dominant and expand in the future due to increasing drought severity; (3) a considerable number of tropical tree species may currently be under threat of local extinction due to topographically biased deforestation trends and (4) trait based survey approaches improve our understanding of the mechanisms behind species compositional trends.