Cuttings of neem trees (Azadirachta indica) were grown for 65 days at four P levels: 0, 15, 30, and 60 mg P/kg soil. Half of the plants were inoculated with the vesicular–arbuscular mycorrhizal fungi (VAM) Glomus intraradices. VAM increased growth and net photosynthesis (A) at the lowest two soil P levels. Increased A was attributed to increased stomatal conductance (g) and greater leaf P concentration. Nonstomatal inhibition of A due to P deficiency also was observed in non-VAM plants at lower soil P levels. At higher soil P, VAM and non-VAM plants had comparable growth, A, g, and tissue concentration of P and other elements. VAM plants at 0 mg P/kg soil had similar growth and leaf P concentration when compared to non-VAM plants at 15 mg P/kg soil, yet had a 11% higher A, indicating a direct effect of VAM on gas exchange. As soil P increased, total VAM colonization and vesicle formation decreased, while the amount of extraradical hyphae increased. Arbuscule formation was highest at 0 and 15 mg P/kg soil. Apparently, arbuscules and extraradical hyphae play an important role in the enhanced growth and gas exchange of VAM plants at lower soil P levels.