Tardigrades are a group of microscopic animals renowned for their ability to survive near complete desiccation. A family of proteins, unique to tardigrades, called Cytoplasmic Abundant Heat Soluble (CAHS) proteins are necessary to mediate robust desiccation tolerance in these animals. However, the mechanism(s) by which CAHS proteins help to protect tardigrades during water-loss have not been fully elucidated. Here we use thermogravimetric analysis to empirically test the proposed hypothesis that tardigrade CAHS proteins, due to their propensity to form hydrogels, help to retain water during desiccation. We find that regardless of its gelled state, both in vitro and in vivo, a model CAHS protein (CAHS D) retains no more water than common proteins and control cells in the dry state. However, we find that while CAHS D proteins do not increase the total amount of water retained in a dry system, they interact with the small amount of water that does remain. Our study indicates that desiccation tolerance mediated by CAHS D cannot be simply ascribed to water retention and instead implicates its ability to interact more tightly with residual water as a possible mechanism underlying its protective capacity. These results advance our fundamental understanding of tardigrade desiccation tolerance which could provide potential avenues for new technologies to aid in the storage of dry shelf-stable pharmaceuticals and the generation of stress tolerant crops to ensure food security in the face of global climate change.