Dryland rivers are characterized by high spatio-temporal variability in water availability, with alternating wet and dry reaches and high variance in stream flow rates.  This study investigated wetland vegetation response to this dynamic: plant communities from perennial and ephemeral reaches were sampled over a three year period spanning a wet to dry climatic cycle.  Wetland plants established along the low-flow channel of the ephemeral reach in a year with a 10-year flow event, resulting in high compositional similarity between ephemeral and perennial sites.  During dry years, however, composition differed significantly between site types.  A seed bank emergence study indicated that viable seeds of wetland species were present in soils of ephemeral sites, but declined in abundance with increased distance from the perennial reach.  Collectively these results indicate that ephemeral wetlands establish during episodic periods of high flow, and suggest that the ephemeral wetlands are dependent on local seed banks and ongoing immigration of propagules.  Because flood events facilitate both in situ seed bank replenishment and seed dispersal from upstream sites, locations closer to reaches with perennial flow have greater capacity to develop ephemeral wetlands. These results have implications for riverine restoration, and indicate that landscape position needs consideration: re-watering projects will have a higher potential for restoration success if located closer to perennial reaches.