White clover (Trifolium repens L.) is an important forage and aesthetic plant species, but it is susceptible to drought and heat stress. The phytohormone auxin regulates several aspects of plant development and alleviates the effects of drought stress in plants, including white clover, by involving auxin/indole acetic acid (Aux/IAA) family genes. However, Aux/IAA genes and the underlying mechanism of auxin-mediated drought response remain elusive in white clover. To extend our understanding of the multiple functions of Aux/IAAs, the current study described the characterization of a member of the Aux/IAA family TrIAA27 of white clover. TrIAA27 protein had conserved the Aux/IAA family domain and shared high sequence similarity with the IAA27 gene of a closely related species and Arabidopsis. Expression of TrIAA27 was upregulated in response to heavy metal, drought, salt, NO, Ca2+, H2O2, Spm, ABA, and IAA treatments, while downregulated under cold stress in the roots and leaves of white clover. TrIAA27 protein was localized in the nucleus. Constitutive overexpression of TrIAA27 in Arabidopsis thaliana led to enhanced hypocotyl length, root length, plant height, leaf length and width, and fresh and dry weights under optimal and stress conditions. There was Improved photosynthesis activity, chlorophyll content, survival rate, relative water content, endogenous catalase (CAT), and peroxidase (POD) concentration with a significantly lower electrolyte leakage percentage, malondialdehyde (MDA) content, and hydrogen peroxide (H2O2) concentration in overexpression lines compared to wild-type Arabidopsis under drought and salt stress conditions. Exposure to stress conditions resulted in relatively weaker roots and above-ground plant growth inhibition, enhanced endogenous levels of major antioxidant enzymes, which correlated well with lower lipid peroxidation, lower levels of reactive oxygen species, and reduced cell death in overexpression lines. The data of the current study demonstrated that TrIAA27 is involved in positively regulating plant growth and development and could be considered a potential target gene for further use, including the breeding of white clover for higher biomass with improved root architecture and tolerance to abiotic stress.