Transplant shock, implicated by depressed seedling physiological status associated with moisture stress immediately following planting, limits early plantation establishment. Large root volume (Rv) has potential to alleviate transplant shock because of higher root growth potential and greater access to soil water. We investigated impacts of drought and transplant Rv on photosynthetic assimilation (A), transpiration (E), stomatal conductance (g(s)), predawn leaf xylem water potential (Psi(L)), and growth of northern red oak (Quercus rubra L.) seedlings to explain mechanisms associated with susceptibility to transplant shock. One year-old barerooot seedlings were graded into four Rv categories and either well watered or subjected to drought consisting of low, medium, or high moisture stress by discontinuing irrigation at 22-day intervals for 3 months. Thereafter, all treatments were re-watered to examine recovery. Transplant shock was signified by reduced A, E, g(s), and Psi(L), which generally increased with increasing moisture stress and Rv. Physiological status improved during recovery, though stress was still evident in seedlings exposed to medium or high moisture stress and in larger Rv seedlings. Growth declined with increasing moisture stress but was generally similar among Rv treatments, likely reflecting greater A at the whole plant level and/or reliance upon stored reserves in large Rv seedlings. The most effective drought avoidance mechanisms were root growth, stomatal regulation, reduced leaf area, and higher growth allocation to roots relative to shoots. Our results suggest that large initial Rv does not enhance drought avoidance during the first season after transplant in northern red oak seedlings.