ABSTRACT We characterized taxonomic and functional differences between two vegetation physiognomies in the Brazilian Chaco, namely chaco woodland (CW) and chaco forest (CF), in order to understand which abiotic and biotic mechanisms underlie the establishment of different physiognomies. We characterized the vegetation physiognomies by comparing woody species composition, richness and diversity and functional diversity between CW and CF plots. We also measured soil variables to characterize abiotic factors related to the different physiognomies. Species richness and diversity and soil nutrient values were higher in CF. Leaf succulence and nitrogen content were higher in CW, while height, leaf area, and specific leaf area were higher in CF. The standardized effect size (SES) of functional richness was higher in CW, but the SES of functional dispersion did not differ between CF and CW. We observed a diversity gradient related to soil fertility. Traits of species in CW were related to adaptations to poor soils, while in CF floristic composition showed a prevalence of species with more attributes related to competition for light. Thus, the structure of the floristic community in CW is likely related to an environmental filter, while competition for resources prevails in CF.