Tree transpiration is an important component of the water cycle in forested ecosystems, accounting for more than 50% of the evaporative fluxes. Assessing the effects of meteorology and water availability on forest ecosystem functions like transpiration is becoming increasingly important in the context of climate change. We exploited the natural variability of soil moisture dynamics along a hillslope to analyse the effects of soil moisture and meteorological forcings on the sap flux dynamics of Fagus sylvatica L. trees. The study site is in the Re della Pietra catchment, Apennine Mountains, Central Italy, characterized by a Mediterranean climate. Sap flux and soil moisture at different depths were monitored at three different locations along the hillslope (TOP, MID and BOTTOM), as were the meteorological conditions outside the forest. The sensitivity of sap flux to hydrometeorological conditions changed along the slope: in the BOTTOM location, transpiration was most sensitive to incoming radiation and vapour pressure deficit, while in the TOP, there was a higher importance of soil moisture; the MID location showed intermediate conditions. A rise in the correlation between soil moisture and transpiration and a decrease in the correlation between transpiration and radiation were observed during the hot and dry month of August, for the TOP and MID locations, following a decrease in soil moisture. We show that in Mediterranean areas, during the growing season, transpiration can switch from “radiation-controlled” to “moisture-controlled”, when a threshold in soil water content is crossed. We provide evidence of spatial heterogeneity in transpiration, due to soil moisture variability, ultimately driven by topography. Furthermore, the severity of the drought effects on trees may be variable at a fine spatial scale due to topography. Accounting for these effects might allow for more effective management strategies, aiming at mitigating the climate change impact on forests and their ecosystem services.