The northeastern U.S. is projected to experience more frequent short-term (1−2 month) droughts interspersed among larger precipitation events. Agroforestry practices such as silvopasture may mitigate these impacts of climate change while maintaining economic benefits of both agricultural and forestry practices. This study evaluated the effects of forest-to-silvopasture (i.e., 50 % thinning) conversion on the components of evapotranspiration (transpiration, rainfall interception, and soil evaporation) during the growing season of 2016. The study coincided with a late-summer drought throughout the northeastern U.S., which allowed us to also evaluate the effects of forest-to-silvopasture conversion on drought responses of multiple tree species, including Pinus strobus, Tsuga canadensis, and Quercus rubra. In the reference forest and silvopasture, we observed declining soil moisture and tree water use during the drought for all three tree species. However, the decline in P. strobus water use in response to declining soil moisture in the silvopasture was not as steep as compared with the reference forest, resulting in greater water use in the silvopasture for this species. In contrast, we did not detect different water-use responses between forest and silvopasture in T. canadensis or Q. rubra. This suggests that forest-to-silvopasture conversion via thinning can alleviate drought stress for P. strobus and that this species may be more sensitive to moisture stress when competition for water is high in denser stands. Evapotranspiration was 35 % lower in the silvopasture compared with the reference forest, primarily a result of lower transpiration and rainfall interception. While soil evaporation was greater in the silvopasture, this was not enough to offset the considerably lower transpiration and interception. We observed greater radial tree growth 1–3 years following conversion in the silvopasture as compared with the reference forest for T. canadensis and Q. rubra, but not for P. strobus. Overall, our results suggest that forest conversion to silvopasture (in lieu of clearcutting for new pasture) may mitigate the impacts of agricultural land use intensification and climate change on ecosystem services, especially in terms of sustaining hydrologic regulation functions. Further study is required to determine the generality of these results and whether these benefits extend beyond the first few years post-conversion.