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Abstract The expansion of an urban tree canopy is a commonly proposed nature-based solution to combat excess urban heat. The influence trees have on urban climates via shading is driven by the morphological characteristics of trees, whereas tree transpiration is predominantly a physiological process dependent on environmental conditions and the built environment. The heterogeneous nature of urban landscapes, unique tree species assemblages, and land management decisions make it difficult to predict the magnitude and direction of cooling by transpiration. In the present article, we synthesize the emerging literature on the mechanistic controls on urban tree transpiration. We present a case study that illustrates the relationship between transpiration (using sap flow data) and urban temperatures. We examine the potential feedbacks among urban canopy, the built environment, and climate with a focus on extreme heat events. Finally, we present modeled data demonstrating the influence of transpiration on temperatures with shifts in canopy extent and irrigation during a heat wave.