AbstractThe contribution of Eucalyptus globulus plantations to timber production for pulp, paper and energy production may be hampered by climate change. It is expected that Eucalyptus productivity may be affected through drought stress and changes to both pathogen distribution/pathogenicity and host–pathogen interactions. The impact of the fungal pathogen Neofusicoccum kwambonambiense on E. globulus, causing cankers and dieback, is well known but the impact of drought on disease development is still understudied. Our aim was to study the effect of drought on N. kwambonambiense infection by inoculating E. globulus plants under well‐watered conditions or with water limitation. Non‐infected plants for both water regimes were also analysed. Morphophysiological, biochemical and hormonal parameters were assessed 65 days post‐inoculation. Inoculation under conditions of water stress decreased water potential and photosynthetic efficiency and increased abscisic acid, jasmonic acid and lipid peroxidation. Water‐stressed infected plants also showed higher fungal colonization and external lesion length in comparison with well‐watered inoculated plants. Our results indicate that drought increased E. globulus predisposition to N. kwambonambiense infection and may also have promoted a change in the lifestyle of the fungus. Identifying host–pathogen interaction responses under different stress conditions is necessary to provide knowledge for decision‐making in the management of forest systems in general and of Eucalyptus production in particular.