The ETS family of transcription factors is a functionally heterogeneous group of gene regulators that share a structurally conserved, eponymous DNA-binding domain. Unlike other ETS homologues, such as Ets-1, DNA recognition by PU.1 is highly sensitive to its osmotic environment due to excess interfacial hydration in the complex. To investigate interfacial hydration in the two homologues, we mutated a conserved tyrosine residue, which is exclusively engaged in coordinating a well-defined water contact between the protein and DNA among ETS proteins, to phenylalanine. The loss of this water-mediated contact blunted the osmotic sensitivity of PU.1/DNA binding, but did not alter binding under normo-osmotic conditions, suggesting that PU.1 has evolved to maximize osmotic sensitivity. The homologous mutation in Ets-1, which was minimally sensitive to osmotic stress due to a sparsely hydrated interface, reduced DNA-binding affinity at normal osmolality but the complex became stabilized by osmotic stress. Molecular dynamics simulations of wildtype and mutant PU.1 and Ets-1 in their free and DNA-bound states, which recapitulated experimental features of the proteins, showed that abrogation of this tyrosine-mediated water contact perturbed the Ets-1/DNA complex not through disruption of interfacial hydration, but by inhibiting local dynamics induced specifically in the bound state. Thus, a configurationally identical water-mediated contact plays mechanistically distinct roles in mediating DNA recognition by structurally homologous ETS transcription factors.