Bio-fertilisation with plant growth promoting rhizobacteria (PGPR) can be extremely beneficial for plant development and growth under harsh environments. PGPR have been recently successfully applied in restoration programmes, but locally adapted strains are needed for successful outcomes. In this study, we evaluated the effect of bio-fertilisation with selected native PGPR strains on the growth and physiological response to drought of Caesalpinia spinosa (Mol.) Kuntze (tara), the main tree species of the Atiquipa forest, a highly valuable and unique ecosystem in the middle of the Atacama Desert in Peru. We compared the growth and physiological status of tara seedlings that were bio-fertilised with three PGPR strains, chemically fertilised and a non-fertilised control, under well-watered and under drought conditions. Seedlings inoculated with Pseudomonas sp. strain RC5.5 showed enhanced tolerance to drought, although under favourable, stress-free conditions it did not promote growth and only significantly increased quantum yield of photosystem II (F_v/F_m). On the other hand, chemical fertilisation highly enhanced plant growth, but led to substantial hydric demand under water limitation. Under drought, RC5.5 bio-fertilised plants showed lower reduction of leaf relative water content, net carbon assimilation rate, stomatal conductance, and a balanced shoot-to-root ratio compared with control plants. Therefore, strain RC5.5 is highlighted as a valuable candidate to be used as inoculant of tara in reforestation and restoration programmes in arid zones, in particular the Atiquipa forest, or in local tara plantations.