Water draws on top of billboard trees.

[Laurens Mathot]

Unity Terrain trees are hidden by both complex and cheap water when they change into billboards.

Unity 4.5

[Laurens Mathot]

Not sure if it's just a problem with the billboard version. This short animation might show the problem more clearly.

[Laurens Mathot]

The standard billboard tree shader doesn't write depth... It relies entirely on being the only transparent object in the scene.

Hopefully there is a way to change which shader is used for tree billboards, to change the queue.

[Laurens Mathot]

Placing a modified Billboard tree shader (Hidden/TerrainEngine/BillboardTree) in the project seems to help.

From Transparent-100 to Transparent+1.

[Laurens Mathot]

Closing this issue unless the workaround ends up causing significant problems.