Setting is the initial stiffening of the cement during which time it loses its plasticity. We say the cement has gone off and it can not be worked any more, but it is still weak. Hardening is the process by which the cement gains strength. It is the time during which the hydration reactions take place and the gels form and these require water. Cement and concrete do NOT gain strength by drying.
Water is, in fact, of critical importance to the forming of good concrete in several ways.