Greening dryland ecosystems greatly benefits from significant CO2 fertilization. This greening trend across global drylands, however, has also been severely constrained by enhancing atmospheric and soil water (SW) deficits. Thus far, the relative offsets in the contributions between the atmospheric vapor pressure deficit (VPD), SW at varying depths, and CO2 fertilization to vegetation dynamics, as well as the differences in the impacts of decreasing SW at different soil depths on dryland ecosystems over long periods, remain poorly recorded. Here, this study comprehensively explored the relative offsets in the contributions to vegetation dynamics between high VPD, low SW, and rising CO2 concentration across global drylands during 1982–2018 using process-based models and satellite-observed Leaf Area Index (LAI), Gross Primary Productivity (GPP), and solar-induced chlorophyll fluorescence (SIF). Results revealed that decreasing-SW-induced reductions of LAI in dryland ecosystems were larger than those caused by rising VPD. Furthermore, dryland vegetation was more severely constrained by decreasing SW on the subsurface (7–28 cm) among various soil layers. Notable offsets were found in the contributions between enhanced water constraints and CO2 fertilization, with the former offsetting approximately 38.49% of the beneficial effects of the latter on vegetation changes in global drylands. Process-based models supported the satellite-observed finding that increasing water constraints failed to overwhelmingly offset significant CO2 fertilization on dryland ecosystems. This work emphasizes the differences in the impact of SW at different soil depths on vegetation dynamics across global drylands as well as highlights the far-reaching importance of significant CO2 fertilization to greening dryland ecosystems despite increasing atmospheric and SW constraints.