The changing nature of the earth's vegetation is a crucial dynamics in ecosystem processes. Here, we investigate the changes in global dryland vegetation over the past two decades and the effects of surface moisture and atmospheric water demand on greening and browning. Our results show that significant greening occurred across approximately 21% of global drylands, with the strongest increases observed in cropland and grassland ecosystems. This greening is closely linked to the increase in soil moisture, which is a key driver of dryland vegetation productivity. Increasing vapor pressure deficit also impacted vegetation productivity, particularly at the areas where moisture declined. The effect of increasing vapor pressure deficit and decline in soil moisture was particularly evident in shrubland ecosystem, where vegetation productivity decreased. Although vapor pressure deficit increased significantly over the drylands, there was enough available moisture for vegetation productivity at the cropland and grassland, which caused greening in these areas. Browning in the drylands is linked to the decline in available moisture and elevated atmospheric water demand. Moisture availability at the cropland is also linked to human footprints from operational irrigation capacity. These findings highlight the dominant role of soil moisture in regulating dryland vegetation dynamics while emphasizing the growing influence of atmospheric dryness under a warming climate.