Understanding the mechanisms controlling secondary succession in tropical dry forests is important for the conservation and restoration of this highly threatened biome. Canopy-forming trees in tropical forests strongly influence later stages of succession through their effect on woody plant regeneration. In dry forests, this may be complex given the seasonal interplay of water and light limitations. We reviewed observational and experimental studies to assess (1) the relative importance of positive and negative effects of established trees on regeneration; (2) the mechanisms underlying these effects; and (3) to test the 'stress gradient hypothesis' in successional tropical dry forests. The effects of established trees on seed dispersal, seed survival, and seed germination—either through direct changes to moisture and temperature regimes or mediated by seed dispersers and predators—are mainly positive. The balance between positive and negative effects on seedling establishment is more complex and depends on the season and leaf phenology of both trees and seedlings. Seedling survival is generally enhanced by established trees mitigating dry conditions. Established trees have counteracting effects on water and light availability that influence seedling growth. The probability of a positive effect of established trees on seedling survival decreases with increased rainfall, which supports the stress gradient hypothesis. Priorities for future research are experiments to test for facilitation and competition and their underlying mechanisms, long-term studies evaluating how these effects change with ontogeny, and studies focusing on the species-specificity of interactions.