The response of understory trees to climate variability is key to understanding current and future forest dynamics. However, analyses of climatic effects on tree growth have primarily focused on the upper canopy, leaving understory dynamics unresolved. We analyzed differences in climate sensitivity based on canopy position of four common tree species (Acer rubrum, Fagus grandifolia, Quercus rubra, and Tsuga canadensis) using growth information from 1,084 trees across eight sites in the northeastern United States. Effects of canopy position on climate response varied, but were significant and often nonlinear, for all four species. Compared to overstory trees, understory trees showed stronger reductions in growth at high temperatures and varied shifts in precipitation response. This contradicts the prevailing assumption that climate responses, particularly to temperature, of understory trees are buffered by the overstory. Forest growth trajectories are uncertain in compositionally and structurally complex forests, and future demography and regeneration dynamics may be misinferred if not all canopy levels are represented in future forecasts.