In freshwater wetland ecosystems, water level is the key factor constraining the growth and reproduction of macrophytes, and consequently influences species composition, community succession, and vegetation distribution. Reproduction is the fundamental behavior and the key life process affecting plant population persistence. Many clonal plants possess the capacity for both sexual reproduction through seeds and clonal propagation (asexual reproduction) through bud banks. In clonal plants, the trade-offs between sexual and asexual reproduction are influenced by biotic variables, such as plant size and population age, and abiotic factors, such as resource levels and successional status. In perennial-dominated ecosystems, such as grasslands and wetlands, clonal reproduction predominates over sexual reproduction. Asexual reproduction is one of the key strategies that the clonal plants in Dongting Lake wetlands use to adapt to environmental stresses. In this study, we investigated the effects of water levels (0 cm, -15 cm, and -30 cm) on the growth and reproductive characteristics of a typical clonal plant-Carex brevicuspis, which is distributed across different elevational zones (23.7 m and 25.8 m asl.) at Dongting Lake wetlands. The results showed that water level has a significant impact on the growth and clonal characteristics of the C. brevicuspis found at both elevations (P < 0.05). The number of ramets and buds, and the biomass of C. brevicuspis found in the high-elevation zone increased as the water level decreased, whereas the growth characteristics (height and total biomass) did not change significantly (P > 0.05). Therefore, a moderate drought improves the clonal propagation of C. brevicuspis in the high-elevation zone. Water level has a significant impact on the growth characteristics (P < 0.05) of C. brevicuspis growing in the low-elevation zone because height and total biomass increased as the water level decreased. The number of ramets and bud biomass decreased as the water level declined, while the number of buds and the ramet biomass were not significantly affected by water level (P > 0.05). Both the plant height and total biomass of C. brevicuspis growing in the low-elevation zone increased as the water level declined, whereas the number of ramets decreased. Therefore, the clonal characteristics of C. brevicuspis were affected not only by the water level, but also by the elevation that the plant occupies. Our results also suggested that C. brevicuspis could access resources in patchy habitats through plasticity in morphological traits and biomass allocation. C. brevicuspis distributed in the high-elevation zone could adapt to a nutrient-rich environment by allocating more resources to the belowground parts and fewer resources to the aboveground shoots. In contrast, C. brevicuspis growing in the high-elevation zone could adapt to the low level of available resources or stressful environments by allocating more resources to the aboveground shoots and fewer resources to the belowground parts. Nevertheless, C. brevicuspis growing in the low-elevation zone did not respond significantly to changes in resource levels through biomass allocation plasticity, which suggests that C. brevicuspis found in the low-elevation zone may not acclimate as quickly to the changes in wetland habitats as the plants growing in the high-elevation zone. These results indicated that C. brevicuspis can deploy different growth and reproductive strategies in response to water stress because of long-term adaptation to particular habitats.