In dryland regions, soil moisture is an important limiting factor for canopy transpiration (T). Thus, clarifying the impact of soil moisture on T is critical for comprehensive forest—water management and sustainable development. In this study, T, meteorological factors (reference evapotranspiration, ETref), soil moisture (relative soil water content, RSWC), and leaf area index (LAI) in a Larix principis-rupprechtii plantation of Liupan Mountains in the dryland region of Northwest China were simultaneously monitored during the growing seasons in 2017–2019. A modified Jarvis—Stewart model was established by introducing the impact of RSWC in different soil layers (0–20, 20–40, and 40–60 cm, respectively) to quantify the independent contribution of RSWC of different soil layers to T. Results showed that with rising ETref, T firstly increased and then decreased, and with rising RSWC and LAI, T firstly increased and then gradually stabilised, respectively. The modified Jarvis—Stewart model was able to give comparable estimates of T to those derived from sap flow measurements. The contribution of RSWC to T in different soil layers has obvious specificity, and the contribution rate of 20–40 cm (13.4%) and 0–20 cm soil layers (6.6%) where roots are mainly distributed is significantly higher than that of 40–60 cm soil layer (1.9%). As the soil moisture status changes from moist (RSWC0–60cm ≥ 0.4) to drought (RSWC0–60cm < 0.4), the role of the soil moisture in the 0–20 cm soil layer increased compared with other layers. The impacts of soil moisture that were coupled into the Jarvis—Stewart model can genuinely reflect the environmental influence and can be used to quantify the contributions of soil moisture to T. Thus, it has the potential to become a new tool to guide the protection and management of forest water resources.