How co-existing species of canopy trees and understory shrubs differentially respond to global warming may affect treeline ecotone dynamics, yet their growth trends and potential underlying ecophysiological mechanisms remain understudied. Here, we used dendrochronology and stable carbon isotope analysis to compare the stem radial growth, intrinsic water-use efficiency (iWUE) and climate sensitivity of co-occurring coniferous trees (Abies fabri Craib) and broadleaved shrubs (Rhododendron faberi subsp. prattiiradial) at a treeline ecotone site in the southeast Tibetan Plateau. The results revealed that the shrub's growth rate has increased significantly over the past 50 years (1973-2022) (P < 0.05), while the growth trend of co-existing trees did not increase significantly. Furthermore, compared with nearby trees, the radial growth of shrubs was more strongly positive correlated with temperature and moisture conditions during the growing season (May-October). Nonetheless, during the more recent 1990-2022 period, iWUE of both woody plant species steadily increased with a rising atmospheric CO2 concentration. Overall, our results suggest that at the treeline ecotone, morphological growth and functional trait differences between coniferous trees and broadleaved shrubs, as well as interactions within and between species, may drive divergent plant physiological processes and ecological strategies in response to rapid global warming.