The effect of restricting irrigation on shoot growth and flower initiation in container-grown Rhododendron cv. Hoppy was assessed. The results showed that controlled water stress can substitute for pruning as a means of manipulating growth and enhancing final plant quality in Rhodonendron. Plants were exposed to three irrigation regimes based on potential evapo-transpiration (ETp) rates: 1.5 ETp (well-watered), 0.75 ETp (moderate drought), 0.25 ETp (severe drought), with regimes imposed for eight weeks during June-July, July-August, August-September or September-October. The degree and timing of drought had significant effects on the water status and growth of plants. Exposing plants to severe drought (0.25 ETp) during July-August inhibited shoot extension for the rest of the season, and plants remained small and compact until re-growth the following spring. Severe drought resulted in the initiation of fewer flower buds than less stressful regimes, especially when applied during the first two periods, June-July and July-August. No significant effect of moderate drought was detected, but the greatest number of flower buds was associated with exposure of plants to 0.75 ETp during early autumn (September-October). Applying irrigation based on potential evapo-transpiration demonstrated that water consumption could be reduced by 50% over an eight-week period, without significantly affecting growth. The results presented have important implications for conserving water supplies on commercial nurseries, and minimizing the need for labour-intensive pruning techniques to maintain plant shape and quality.