We investigated physiological characters associated with water balance in laboratory populations of Drosophila melanogaster selected for resistance to desiccating conditions for over 100 generations. Five replicate, outbred, desiccation-selected (D) populations were compared with their control (C) populations. Water loss rates of female D flies were approximately 40% lower than those of C females. Although excretory water loss was reduced in desiccation-selected flies, it comprised less than 10% of total water loss, indicating that the D populations have evolved reduced cuticular and/or respiratory water loss rates. Total surface lipid amounts did not differ between the C and D flies. Cuticular hydrocarbons from D flies were longer than those from C flies and melted at slightly higher temperatures, possibly contributing to reduced water loss rates. Desiccation-selected flies contained approximately 30% more bulk water than controls, as well as more glycogen. However, total metabolic water stores did not differ between the stocks owing to higher lipid levels in the C populations. The ability to tolerate water loss, as measured by water content at the time of death, did not differ between D and C flies. Thus, evolution of increased desiccation resistance has occurred by multiple physiological mechanisms, but some potential adaptive differences have not evolved.