Although transplanted trees typically establish and grow without incident in frequently irrigated turfgrass, their performance in precisely irrigated turfgrass in an arid climate is not known. We investigated the effect of precision irrigation scheduling on growth and water relations of balled-and-burlapped littleleaf linden (Tilia cordata Mill. `Greenspire') planted in buffalograss (Buchloë dactyloides [Nutt.] Engelm. `Tatanka') and kentucky bluegrass (Poa pratensis L.). Over 2 years, trees in turfgrass were irrigated either by frequent replacement based on local reference evapotranspiration, or precision irrigated by estimating depletion of soil water to the point of incipient water stress for each turfgrass species. Predawn leaf water potential and stomatal conductance of trees were measured during first-year establishment, and predawn leaf water potential was measured during a mid-season water-deficit period during the second year. Trunk diameter growth and total tree leaf area were measured at the end of each year. Values of predawn leaf water potential and stomatal conductance of trees in precision-irrigated buffalograss were lower (–0.65 MPa, 25.3 mmol·m–2·s–1) than those of trees in the other treatments near the end of the first growing season. The longer interval between precision irrigations resulted in mild water stress, but was not manifested in growth differences among trees across treatments during the first season. During the water-deficit period of the second year, there was no evidence of stress among the trees regardless of treatment. At the end of the second season, total leaf area of trees grown in precision-irrigated kentucky bluegrass (1.10 ± 0.34 m2) was 46% of that of trees grown in buffalograss (2.39 ± 0.82 m2) that were irrigated frequently. Trunk diameter growth of trees in frequently irrigated kentucky bluegrass (1.91 ± 2.65 mm) was 29% of that of the trees grown in buffalograss (6.68 ± 1.68 mm), regardless of irrigation treatment, suggesting a competition effect from kentucky bluegrass. We conclude that frequent irrigation of balled-and-burlapped trees in turfgrass, particularly buffalograss, is more conducive to tree health during establishment than is maximizing the interval between turfgrass irrigation. Regardless of irrigation schedule, kentucky bluegrass appears to impact tree growth severely during establishment in an arid climate.