Disentangling short- and long-term neighbour effects, using both removal and observational methods within a single experiment, has strongly improved our understanding of the driving mechanisms of plant-plant interactions. However, there has been no attempt to assess two important underlying processes of their changes along gradients, environmental-severity (changes in target performance without neighbours) and neighbour-traits (changes in performance with neighbours) effects, the former previously shown in alpine communities to be involved in competition and the latter in facilitation. We addressed this goal in an experiment conducted in continental saline depressions (sebkhas) from the Mediterranean arid climate of central Tunisia. We quantified short- and long-term effects of dominant shrubs, transplanting three target grass species in open, nurse and removed-nurse microhabitats of two habitats of different salinity levels in height sebkhas. The design extended geographically from central Tunisia to the Libyan border, 500km southeastward. We used the Relative Interaction Index to calculate short- and long-term effects of neighbours on target species before and after the dry summer seasons and to disentangle environmental-severity from neighbour-trait effects. Short-term effects were slightly negative and long-term effects strongly positive before the dry summer season in the two habitats. Short-term effects switched to positive with increasing drought stress, due to increasing environmental severity (decrease in the response without neighbours), whereas long-term effects decreased due to decreasing environmental mitigation (decrease in the response with neighbours). Soil moisture measurements showed that both changes were due to vanishing shrub soil engineering-effects during the summer drought. We conclude that an increase in short-term facilitation with increasing drought stress through time, apparently supporting the Stress-Gradient-Hypothesis, might be due to a decrease in long-term facilitation. Our study highlights that assessing the effects of neighbours with both the removal and observational methods is crucial for understanding the driving processes of plant-plant interactions in arid systems.