Drought responses of mature trees are still poorly understood making it difficult to predict species distributions under a warmer climate. Using mature European beech (Fagus sylvatica L.), a widespread and economically important tree species in Europe, we aimed at developing an empirical stress-level scheme to describe its physiological response to drought. We analysed effects of decreasing soil and leaf water potential on soil water uptake, stem radius, native embolism, early defoliation and crown dieback with comprehensive measurements from overall nine hydrologically distinct beech stands across Switzerland, including records from the exceptional 2018 drought and the 2019/2020 post-drought period. Based on the observed responses to decreasing water potential we derived the following five stress levels: I (predawn leaf water potential >-0.4 MPa): no detectable hydraulic limitations; II (-0.4 to -1.3): persistent stem shrinkage begins and growth ceases; III (-1.3 to -2.1): onset of native embolism and defoliation; IV (-2.1 to -2.8): onset of crown dieback; V (<-2.8): transpiration ceases and crown dieback is >20%. Our scheme provides, for the first time, quantitative thresholds regarding the physiological downregulation of mature European beech trees under drought and therefore synthesises relevant and fundamental information for process-based species distribution models. Moreover, our study revealed that European beech is drought vulnerable, because it still transpires considerably at high levels of embolism and because defoliation occurs rather as a result of embolism than preventing embolism. During the 2018 drought, an exposure to the stress levels III-V of only one month was long enough to trigger substantial crown dieback in beech trees on shallow soils. On deep soils with a high water holding capacity, in contrast, water reserves in deep soil layers prevented drought stress in beech trees. This emphasises the importance to include local data on soil water availability when predicting the future distribution of European beech.