In managed settings, seedlings are often fertilized with the objective of enhancing establishment, growth, and survival. However, responses of seedlings to fertilization can increase their susceptibility to abiotic stresses such as drought. Seedlings acclimate to variation in soil resources by reallocating carbon among different physiological processes and compartments, such as above versus belowground growth, secondary metabolism, and support of ectomycorrhizal fungi (EMF). We examined the effects of nutrient and water availability on carbon allocation to above and belowground growth of river birch (Betula nigra), as well as partitioning among root sugars, starch, phenolics, lignin, and EMF abundance. As nutrient availability increased, total plant biomass and total leaf area increased, while percent root biomass decreased. Root sugars, total root phenolics and EMF abundance responded quadratically to nutrient availability, being lowest at intermediate fertility levels. Decreased water availability reduced total leaf area and root phenolics relative to well-watered controls. No interactions between nutrient and water availability treatments were detected, which may have been due to the moderate degree of drought stress imposed in the low water treatment. Our results indicate that nutrient and water availability significantly alter patterns of carbon allocation and partitioning in roots of Betula nigra seedlings. The potential effects of these responses on stress tolerance are discussed.