Exposure to more frequent ocean warming events is driving the loss of coral reef cover as the window of recovery between episodes of bleaching reduces. Coral propagation via in situ nurseries and subsequent outplanting have increased worldwide to support replenishing coral cover on degraded reefs. However, challenges in identifying fast-growing and bleaching-resistant target corals have limited how informative we can be regarding the resilience of outplanted corals. Here, we employed short-term thermal stress assays using the Coral Bleaching Automated Stress System (CBASS) to assess the thermal threshold of a fast-growing coral pre- and post-propagation on in situ nursery frames. We show that year-long nursery-propagated corals exhibit a statistically significant reduction in thermal thresholds (i.e., ED50s) compared to their corresponding reef-based donor colonies based on dose–response modelling of dark acclimated photosynthetic efficiency. RNA-Seq was then used to assess the underlying drivers of this thermotolerance reduction, identifying that processes involved in metabolic and oxidative stress management were disrupted in nursery versus donor heat-treated corals. Whether trade-offs during potential growth-focused phases (post-fragmentation), nursery conditions, and/or a consecutively high summer heat-load drove the lower thermal capacity remains to be determined. However, nursery corals expressed genes associated with telomere maintenance, which are typically expressed in stress-sensitive fast-growing corals under seasonal environmental stress, suggesting consecutively high summer heat-loading contributed to the observed patterns. Our results highlight that thermal tolerance is (i) variable and (ii) subject to acclimation to varying degrees across colonies and. Thus, a path forward for reef practitioners to improve propagation efforts may entail the initial screening of a larger reef population from which thermally superior colonies can be selected for propagation.