Achnatherum inebrians (drunken horse grass, DHG) plants, a dominant grass species in the arid and semi-arid regions of northwest China, symbiotic with an Epichloë fungal endophyte, is well adapted to drought. However, little is known about how the presence of the foliar Epichloë endophyte enhances the tolerance of DHG to drought at the molecular level. This study explored the positive effects of the presence of the Epichloë endophyte on plant growth, biomass, and photosynthetic efficiency and processes of DHG under non-drought and two drought (moderate and severe) treatments, using RNA sequencing to compare transcriptomes. The transcriptome results showed that 32 selected unigenes involved in the photosynthesis processes within Epichloë symbiotic plants were differently expressed (DEGs) versus non-symbiotic plants. The majority of these selected DEGs were upregulated in Epichloë symbiotic plants versus non-symbiotic plants, such as upregulated unigenes (c51525.graph_c1, c47798.graph_c0 & c64087.graph_c0) under drought conditions. In line with the transcriptomes data, the presence of the Epichloë endophyte promoted the photosynthetic rate and biomass accumulation of DHG plants, and the relationship between the photosynthetic rate and biomass is linear and significant. The presence of the endophyte only increased the biomass per tiller of DHG plants under drought. This study provides further insights into the molecular mechanisms that underlie the enhanced plant growth and drought tolerance of Epichloë-symbiotic DHG plants.