A historically unprecedented mountain pine beetle (MPB) outbreak affected western Montana during the past decade. We examined radial growth rates (AD 1860–2007/8) of co-occurring mature healthy and MPB-infected ponderosa pine trees collected at two sites (Cabin Gulch and Kitchen Gulch) in western Montana and: (1) compared basal area increment (BAI) values within populations and between sites; (2) used carbon isotope analysis to calculate intrinsic water-use efficiency (iWUE) at Cabin Gulch; and (3) compared climate-growth responses using a suite of monthly climatic variables. BAI values within populations and between sites were similar until the last 20–30 years, at which point the visually healthy populations had consistently higher BAI values (22–34%) than the MPB-infected trees. These results suggest that growth rates two–three decades prior to the current outbreak diverged between our selected populations, with the slower-growing trees being more vulnerable to beetle infestation. Both samples from Cabin Gulch experienced upward trends in iWUE, with significant regime shifts toward higher iWUE beginning in 1955–59 for the visually healthy trees and 1960–64 for the MPB-infected trees. Drought tolerance also varied between the two populations with the visually healthy trees having higher growth rates than MPB-infected trees prior to infection during a multi-decadal period of drying summertime conditions. Intrinsic water-use efficiency significantly increased for both populations during the past 150 years, but there were no significant differences between the visually healthy and MPB-infected chronologies.