Abstract Enhancing tree diversity may be important to fostering resilience to drought‐related climate extremes. So far, little attention has been given to whether tree diversity can increase the survival of trees and reduce its variability in young forest plantations. We conducted an analysis of seedling and sapling survival from 34 globally distributed tree diversity experiments (363,167 trees, 168 species, 3744 plots, 7 biomes) to answer two questions: (1) Do drought and tree diversity alter the mean and variability in plot‐level tree survival, with higher and less variable survival as diversity increases? and (2) Do species that survive poorly in monocultures survive better in mixtures and do specific functional traits explain monoculture survival? Tree species richness reduced variability in plot‐level survival, while functional diversity (Rao's Q entropy) increased survival and also reduced its variability. Importantly, the reduction in survival variability became stronger as drought severity increased. We found that species with low survival in monocultures survived comparatively better in mixtures when under drought. Species survival in monoculture was positively associated with drought resistance (indicated by hydraulic traits such as turgor loss point), plant height and conservative resource‐acquisition traits (e.g. low leaf nitrogen concentration and small leaf size). Synthesis. The findings highlight: (1) The effectiveness of tree diversity for decreasing the variability in seedling and sapling survival under drought; and (2) the importance of drought resistance and associated traits to explain altered tree species survival in response to tree diversity and drought. From an ecological perspective, we recommend mixing be considered to stabilize tree survival, particularly when functionally diverse forests with drought‐resistant species also promote high survival of drought‐sensitive species.