Although insect galls are widely known to influence source-sink relationships in plants, the relationship between photosynthesis and gall activity has not been extensively studied. In this study we used 14CO2, photosynthesis, and respiration measurements to examine the capacity of bud galls induced by the wasp Trichilogaster signiventris (Pteromalidae) as carbon sinks in Acacia pycnantha. Galls of this species develop either in vegetative or reproductive buds, depending on the availability of tissues at different times of the year, and effectively eliminate seed production by the plant. Photosynthetic rates in phyllodes subtending clusters of galls were greater than rates in control phyllodes, a result we attributed to photosynthesis compensating for increased carbon demand by the galls. Contrary to previous studies, we found that photosynthesis within galls contributed substantially to the carbon budgets of the galls, particularly in large, mature galls, which exhibited lower specific respiration rates allowing for a net carbon gain in the light. To determine the sink capacity and competitive potential of galls, we measured the proportion of specific radioactivity in galls originating from either vegetative or reproductive buds and found no difference between them. The proportion of the total amount of phyllode-derived 14C accumulated in both clustered and solitary galls was less than that in fruits. Galls and fruits were predominantly reliant on subtending rather than on distant phyllodes for photosynthate. Solitary galls that developed in vegetative buds constituted considerably stronger sinks than galls in clusters on inflorescences where there was competition between galls or fruits for resources from the subtending phyllode. Wasps developing in solitary vegetative galls were correspondingly significantly larger than those from clustered galls. We conclude that, in the absence of inflorescence buds during summer and fall, the ability of the wasps to cause gall formation in vegetative tissues tempers intraspecific competition and substantially increases the availability of plant resources for the development of wasps in such galls.