Species‐specific hydraulic traits play an important role in ecosystem response to water stress; however, representation of biodiverse forest canopies remains a challenge in land surface models. We introduce FETCH4, a multispecies, canopy‐level, hydrodynamic model, which builds upon previous versions of the finitedifference ecosystem‐scale tree crown hydrodynamics model (FETCH). FETCH4 simulates water transport through the soil, roots, and stem as porous media flow. Stomatal conductance is controlled by xylem water potential, which is resolved along the vertical dimension. A key feature of FETCH4 is a multispecies canopy formulation, which uses crown and stem dimensional characteristics to allow the model to produce both treelevel and plot‐level outputs and improves the representation of hydraulic traits and their variation among trees and species. We demonstrate the model’s performance in a mixed temperate forest in Michigan with species of contrasting hydraulic strategies. We optimize species‐specific hydraulic parameters using a Bayesian optimization framework incorporating sapflow measurements. FETCH4 performed well in simulating sapflow of species with contrasting hydraulic strategies under conditions of water stress. In addition, the model was able to capture higher‐level emergent traits, such as drought sensitivity. Using FETCH4 in combination with available observations can provide unique insights about difficult to measure hydraulic traits and plant hydrodynamics.