Modulation of photosynthesis and the underlying mechanisms were studied in mulberry (Morus indica L. genotype V1) under progressive drought stress conditions. Five months old potted mulberry plants were arranged in a semi-controlled glasshouse chamber in completely randomized block design with four replications. On day 1 (D1), the plants were subjected to two watering treatments: well-watered (WW) and water-stressed (WS). In WS plants, watering was completely withheld for next 10days (D1-D10), whereas the WW plants were maintained at 100% pot water holding capacity. Photosynthetic performance was tracked periodically (from D0 to D10) through measurements of leaf gas exchange and chlorophyll a fluorescence (OJIP) transients and additionally leaf protein analyses were performed on D10. Down-regulation in net CO(2) fixation (P(n)) was primarily mediated through stomatal limitation which concurrently reduced transpiration rate (E), stomatal conductance (g(s)) and intercellular CO(2) concentration (C(i)). The OJIP transients and other associated biophysical parameters elucidated the events of photoacclimatory changes in photosystem II (PSII) with progressive increase in drought stress. Down-regulation of PSII activity occurred predominantly due to increase in inactive reaction centers (RCs), decrease in electron transport per RC (ET(O)/RC) as well as per leaf cross-section (ET(O)/CS(m)) and enhanced energy dissipation. The L and K-bands appeared only in the stage of extreme drought severity indicating the ability of genotype V1 to resist drought-induced damage on structural stability of PSII and imbalance between the electrons at the acceptor and donor sides of PSII, respectively. Drought-induced changes in leaf protein analyses revealed significant up-regulation of important proteins associated to photostability of thylakoid membrane including oxygen evolving enhancer, chlorophyll a/b binding proteins, rubisco and rubisco activase. Further, the antioxidative defense proteins including peroxiredoxin and NADH ubiquinone oxidoreductase were also enhanced. In conclusion, our data demonstrate an integrated down-regulation of the photosynthetic process to maintain intrinsic balance between electron transfer reactions and reductive carbon metabolism without severe damage to PSII structural and functional integrity.