Two annual desert plants, Malcolmia africana (L.) R.Br. (Brassicaceae) and Bassia hyssopifolia (Pall.) Kuntz (Chenopodiaceae) were selected to determine the combined effects of nitrogen deposition and water stress on their growth and physiological responses. Nitrogen addition and water stress significantly affected growth of both species. Root weight, leaf number, average leaf area, total biomass, and the shoot/root ratio increased with N addition. For both species, increasing N levels were correlated with higher concentrations of chlorophyll and soluble proteins, higher net photosynthetic rates, and lower content of soluble sugars and proline. M. africana was more sensitive to water stress than B. hyssopifolia, but few differences were observed between the species in their response to N addition. The negative effects of water stress on growth and physiological responses were partly compensated by increased N supply. Overall, the results suggest that N deposition could lead to an increase in annual plant growth in the Gurbantunggut Desert in northwestern China.