The combination of drought and fire can cause drastic changes in forest composition and structure. Given the predictions of more frequent and severe droughts and forecasted increases in fire size and intensity in the western United States, we assessed the impact of drought and different fire intensities on Pinus ponderosa saplings. In a controlled combustion laboratory, we exposed saplings to surface fires at two different fire intensity levels (quantified via fire radiative energy; units: MJ m−2). The recovery (photosynthesis and bud development) and mortality of saplings were monitored during the first month, and at 200- and 370-days post-fire. All the saplings subjected to high intensity surface fires (1.4 MJ m−2), regardless of the pre-fire water status, died. Seventy percent of pre-fire well-watered saplings recovered after exposure to low intensity surface fire (0.7 MJ m−2). All of the pre-fire drought-stressed saplings died, even at the lower fire intensity. Regardless of the fire intensity and water status, photosynthesis was significantly reduced in all saplings exposed to fire. At 370 days post-fire, burned well-watered saplings that recovered had similar photosynthesis rates as unburned plants. In addition, all plants that recovered or attempted to recover produced new foliage within 35 days following the fire treatments. Our results demonstrate that the pre-fire water status of saplings is an important driver of Pinus ponderosa sapling recovery and mortality after fire.