<p>The distribution of leaf nitrogen (N<sub>L</sub>) within canopies has been discussed for decades in relation to the optimality hypothesis that predicts coordination of carboxylation capacity with absorbed light. Although an optimal (that is, proportional) response of both carboxylation capacity and N<sub>L</sub>to light is extensively supported by field observations of variation among sites, the observed saturation curve of N<sub>L</sub>within canopies seems to challenge the generality of that response. By considering dynamic light regimes, we propose an optimality-based theory that successfully reconciles the apparent conflict of observed N<sub>L</sub>distribution within and between canopies. This theory proposes that due to the highly uneven temporal distribution of sun flecks, the light level to which understory leaves acclimate is much higher than the average light level. This proposition leads to a saturation curve for the vertical distribution of N<sub>L</sub>. Our within-canopy data analysis supports this theory. Understorey leaves require significantly less N<sub>L</sub>to achieve photosynthetic capacity as an acclimation to sun flecks. The contribution of structural and photosynthetic components to N<sub>L</sub>predicted by the theory is quantitatively and consistently supported by global datasets of variation both within and between canopies.</p>