Seedlings in tropical forests are ultimately the source of canopy trees, thus factors controlling their composition and growth potentially influence the composition of the forest. Seedlings are primarily limited by above-ground competition with trees, but below-ground competition is potentially also important. Over 4 y we experimentally reduced below-ground competition by trenching to 50 cm and reduced drought stress by irrigating in the dry seasons (6 cm every 2 d) in the understorey of a semi-evergreen rain forest in Panama. There were four irrigated plots and four unirrigated, in each plot there were eight subplots (four trenched, four untrenched); 32 seedlings (two per subplot) of each of four tree species were equally allocated to the four treaments; the four species were: Aspidosperma cruenta; Gustavia superba; Simarouba amara and Tachigali versicolor. Over all species together, trenching increased seedling height by 41% and leaf area by 140% over 4 y. The cause was likely to be increased nutrient supply, because the amounts of N, K and Ca were higher in trenched plants, though concentrations were not higher. Irrigation had no significant effect on growth. Irrigation, but not trenching, reduced seedling mortality. We conclude that below-ground competition was a major limitation for seedling growth for at least some common species (Gustavia and Tachigali in this experiment). More experiments are necessary to determine whether below-ground competition is also important in other tropical rain forests on fairly fertile soils.