This study investigated several aspects related to drought tolerance in arbuscular mycorrhizal (AM) soybean plants. The investigation included both shoot and root tissues in order to reveal the preferred target tissue for AM effects against drought stress. Non-AM and AM soybean plants were grown under well-watered or drought-stressed conditions, and leaf water status, solute accumulation, oxidative damage to lipids, and other parameters were determined. Results showed that AM plants were protected against drought, as shown by their significantly higher shoot-biomass production. The leaf water potential was also higher in stressed AM plants (-1.9 MPa) than in non-AM plants (-2.5 MPa). The AM roots had accumulated more proline than non-AM roots, while the opposite was observed in shoots. Lipid peroxides were 55% lower in shoots of droughted AM plants than in droughted non-AM plants. Since there was no correlation between the lower oxidative damage to lipids in AM plants and the activity of antioxidant enzymes, it seems that first the AM symbiosis enhanced osmotic adjustment in roots, which could contribute to maintaining a water potential gradient favourable to the water entrance from soil into the roots. This enabled higher leaf water potential in AM plants during drought and kept the plants protected against oxidative stress, and these cumulative effects increased the plant tolerance to drought.