Understaffing is a ubiquitous but under-researched stressor at work that is most likely getting even more influential in the future. Our study therefore aims at a closer investigation of understaffing and its implications in employees’ everyday work. Based on the transactional model of stress and previous research findings, we examine how employees appraise both personnel (i.e., a lack of employees within a unit to adequately fulfill essential work tasks and functions) and expertise (i.e., a lack of employee knowledge, skills, or abilities within a unit) understaffing in their daily work (i.e., as a challenge, hindrance, and/or threat) as well as implications related to these different stress appraisals. Toward this aim, we conducted an online daily diary study. Within two working weeks, employees completed daily surveys at noon and at the end of their workday (N = 111 employees, n = 806 workdays). As the results of multilevel path modeling show, both dimensions of understaffing relate differently to stress appraisals. As hypothesized, daily personnel understaffing related positively to threat appraisal, whereas daily expertise understaffing related positively to hindrance appraisal. Contrary to our expectations, neither personnel nor expertise understaffing were positively related to challenge appraisal. As expected, daily personnel understaffing showed a positive indirect relationship with exhaustion via threat appraisal. Our results highlight the importance of acute understaffing in daily work for employee strain as well as the need to simultaneously consider both dimensions in theory and practice. This should help toward a better understanding of understaffing and to develop targeted interventions.