The effect of shoot density and crop level on gas exchange and water relations of filed-grown Sauvignon blanc was studied. Ten and 44 shoots/vine and one and two clusters per shoot treatments were examined in a factorial design. The two-cluster treatments had higher stem water potential (Ystem), assimilation rate, and stomatal (gs) and nonstomatal (gm) conductance. A quantitative analysis suggests that capacitance cannot account for the simultaneous increase in gs and Ystem in the two clusters treatment. The two-cluster treatment had higher Ystem for similar transpiration rates (similar gs) compared to the one-cluster treatment. The similar transpiration rate and lower stem to root water potential difference in the two-cluster treatment was explained by increased root permeability in the two-cluster treatment. The similar gs–gm, in spite of a meaningful decrease of gs with decreasing Ystem, suggests that gs and gm synchronize themselves to perturbations of gm due to sink effect and gs due to water stress.