The terrestrial biosphere has the ability to partially mitigate climate change as it can counterbalance anthropogenic greenhouse gas emissions, to a certain extent. However, this ability is in turn constraint by climate change. To predict future biosphere-climatic feedbacks we need a better understanding of the impact of climate change on the key underlying processes regulating the exchange of carbon, water and nutrients in the soil-plant-atmosphere continuum. In this talk, I will focus on the impacts of rising atmospheric CO2 concentration and increased aridity, due to climate change, on the exchange of water and carbon between the terrestrial vegetation and the soil and the atmosphere. I will give an overview of the results from two manipulative experiments where we assessed the effects of future atmospheric CO2 concentrations and changes in precipitation regimes at the whole ecosystem level. I will also introduce some novel approaches to track these fluxes using atmospheric trace gases and stable isotopes of carbon and water that we implemented applying the latest available spectroscopy techniques.