The consequences of altered abscisic acid (ABA) sensitivity in gray poplar (Populus x canescens [Ait.] Sm.) development were examined by ectopic expression of the Arabidopsis (Arabidopsis thaliana) mutant abi1 (for abscisic acid insensitive1) gene. The expression resulted in an ABA-insensitive phenotype revealed by a strong tendency of abi1 poplars to wilt, impaired responsiveness of their stomata to ABA, and an ABA-resistant bud outgrowth. These plants therefore required cultivation under very humid conditions to prevent drought stress symptoms. Morphological alterations became evident when comparing abi1 poplars with poplars expressing Arabidopsis nonmutant ABI1 or wild-type plants. abi1 poplars showed increased stomatal size, enhanced shoot growth, and retarded leaf and root development. The increased stomatal size and its reversion to the size of wild-type plants by exogenous ABA indicate a role for ABA in regulating stomatal development. Enhanced shoot growth and retarded leaf and root development support the hypothesis that ABA acts independently from drought stress as a negative regulator of growth in shoots and as a positive regulator of growth in leaves and roots. In shoots, we observed an interaction of ABA with ethylene: abi1 poplars exhibited elevated ethylene production, and the ethylene perception inhibitor Ag⁺ antagonized the enhanced shoot growth. Thus, we provide evidence that ABA acts as negative regulator of shoot growth in nonstressed poplars by restricting ethylene production. Furthermore, we show that ABA has a role in regulating shoot branching by inhibiting lateral bud outgrowth.