Water-deficit stress is a major environmental factor that limits agricultural productivity worldwide. Recent episodes of extreme drought have severely affected cotton production in the Southwestern USA. There is a pressing need to develop cotton varieties with improved tolerance to water-deficit stress for sustainable production in water-limited regions. One approach to engineer drought tolerance is by delaying drought-induced senescence via up-regulation of cytokinin biosynthesis. The isopentenyltransferase gene (IPT) that encodes a rate limiting enzyme in cytokinin biosynthesis, under the control of a water-deficit responsive and maturation specific promoter PSARK was introduced into cotton and the performance of the PSARK::IPT transgenic cotton plants was analyzed in the greenhouse and growth chamber conditions. The data indicate that PSARK::IPT-transgenic cotton plants displayed delayed senescence under water deficit conditions in the greenhouse. These plants produced more root and shoot biomass, dropped fewer flowers, maintained higher chlorophyll content, and higher photosynthetic rates under reduced irrigation conditions in comparison to wild-type and segregated non-transgenic lines. Furthermore, PSARK::IPT-transgenic cotton plants grown in growth chamber condition also displayed greater drought tolerance. These results indicate that water-deficit induced expression of an isopentenyltransferase gene in cotton could significantly improve drought tolerance.