Nitrogen (N) bioavailability is one of the main limiting factors for microbial activity and vegetation establishment in bauxite-processing residue sand (BRS). Although beneficial effects of biochar on reducing N loss in the early stages of BRS rehabilitation have been observed previously, the underlying mechanisms of this complicated process, particularly the interactions between applied biochar and the plant rhizosphere is largely unknown. This glasshouse study (116 days), investigated the coupled effects of biochar and water stress on N bioavailability in the rhizosphere of ryegrass (Lolium rigidum) grown in BRS amended with di-ammonium phosphate (DAP) fertiliser (at rates of 0 or 2.7 t ha-1) with and without biochar amendment. The applied biochar was characterised as either aged acidic (AC) or alkaline pine (PC) and was mixed with BRS at a rate of 5% v/v under four moisture regimes (50%, 40%, 20% and 7.5% water holding capacity). Amending BRS with AC and PC biochars increased NH4+ retention and decreased cumulative NH3 volatilization within both the rhizosphere and root-free zones compared with fertiliser only treatment. These effects were more pronounced for the AC than PC biochar, suggesting that aged acidic biochar has the great potential for use in rapid establishment of vegetation in BRS disposal areas. The biochar amendment increased cumulative nitrous oxide emissions compared with DAP only treatment, with no significant differences among different moisture regimes. The Control and 20% water holding capacity (WHC) treatment showed the highest dissolved organic carbon (DOC) concentrations compared with other treatments and moisture regimes in the ryegrass rhizosphere, while the highest dissolved organic N concentration were observed in the DAP + AC treatment. Reducing moisture levels below 20% WHC generally decreased microbial biomass carbon (MBC) concentrations and activity in both the rhizosphere and root-free zones of all treatments, while total N generally decreased as moisture levels decreased from 50% to 7.5% WHC. Plant took up more N in the DAP + AC treatment compared with DAP + PC and DAP only treatments, while increasing water stress generally resulted in decreased aboveground biomass.