Plant hydraulics substantially affects terrestrial water and carbon cycles by modulating water transport and carbon assimilation. Despite improved drought simulations in certain ecosystems through their integration into land surface models (LSMs), the broader application of plant hydraulics in diverse ecosystems and hydroclimates is still underexplored. In this study, we implemented the recently developed Noah-Multiparameterization Land Surface Model (Noah-MP LSM) equipped with a plant hydraulics scheme (Noah-MP-PHS) across 40 FLUXNET sites globally. Employing the Shuffled Complex Evolution-University of Arizona (SCE-UA) auto-calibration algorithm, we optimized key plant hydraulics parameters for these sites spanning eight vegetation types in both arid and humid climates. Noah-MP-PHS significantly improves the simulation of evapotranspiration (ET) and gross primary production (GPP) by better representing atmospheric and soil water stress compared to traditional soil hydraulic schemes (SHSs, such as Noah and CLM). The augmented Noah-MP-PHS models reduce surface flux overestimation and underestimation, exhibiting an average increase of 0.14 and 0.15 in Kling-Gupta Efficiency (KGE) compared to Noah and CLM, respectively. The explicit consideration of plant capacitance in PHS reveals substantial deep-layer and nocturnal root water uptake especially under dry conditions. We employed eXplainable Machine learning (XML) to quantify the model's relative sensitivity to newly introduced leaf-, stem- and root-related parameters in PHS. The sensitivity analysis reveals a rise in root parameter importance and a decline in leaf and stem parameters as conditions shift from humid to arid. These findings indicate that as aridity states vary, the most influential parameters affecting surface fluxes variation may change in parameter calibration for PHS applications. Our findings underscore the importance of incorporating plant hydraulics into LSMs to enhance simulations of terrestrial water and carbon dynamics. These findings are crucial for understanding ecosystem responses to global climate changes and guide the broader application of PHS at larger scales.