Abstract Soil moisture drydown patterns encode signatures of vegetation water‐use. Previous characterizations of the drydown patterns assume a static linear relationship between water‐limited transpiration and available moisture. However, ecohydrological studies show that vegetation exhibits a spectrum of responses to water availability, suggesting that soil moisture loss functions may be nonlinear. To represent these dynamics, we introduce a nonlinearity parameter to the loss function. Our analysis shows that the nonlinear loss model improves the characterization of the satellite‐observed soil moisture drydowns. Globally, functional responses of drydowns are dominated by convex nonlinearity, showing less ecosystem water loss in dry soils than the linear loss function predicts. We find distinct degrees of nonlinearity among different vegetation types; areas with non‐woody vegetation more frequently exhibit a concave nonlinearity, the signature of aggressive water‐use strategies. We propose the nonlinear loss function as a continuous and dynamic framework to represent vegetation water‐use under changing water availability.