Natural polymer-based hydrogels are preferred as soil water retention agents due to their inherent biocompatibility and biodegradability. Generally, these natural polymers are chemically modified by graft polymerization of vinyl monomers to improve their water absorption and retention properties. Among the polysaccharides used to prepare natural hydrogels, those based on sodium alginate (Alg) stand out for their high-water absorption and retention capacity, as well as for their ability to promote plant growth. The main objective of this study was to develop a biodegradable alginate-based hydrogel as a water retainer to promote plant growth under water deficit conditions. The synthesis was achieved by grafting poly(acrylamide) (PAM) onto Alg backbone, using bisacrylamide as chemical crosslinker and different ratios of alginate:acrylamide (Ac). In addition, Eucalyptus nitens seedlings were used as a model plant to evaluate the effect of alginate-g-polyacrylamide (Alg:PAM) hydrogel application to the growing medium on plant survival, growth, and physiological responses under both well-watered and water-deficient soil conditions. The maximum degree of swelling (65 g/g) was obtained for the hydrogel prepared. The pseudo-second order model described the water uptake kinetics of the hydrogel. The degradability of Alg:PAM hydrogel reached up to 85 % in 5 weeks in soil and occurs by breaking the glycosidic bonds of the alginate. The E. nitens seedlings cultivated with different doses of Alg:PAM hydrogel (4:1 Alg:Ac) showed higher values of height and root diameter relative growth, survival and photosynthetic responses in comparison to non-treated plants. The results indicate that Alg:PAM hydrogel (4:1 Alg:Ac) has promising applications in forestry as a water retention and seedling growth promoter under water deficient conditions.