In dryland ecosystems, natural recovery of biological soil crusts (biocrusts) following disturbance may be slow or inhibited, necessitating active restoration practices. While biocrusts can be readily propagated under environmentally controlled conditions, rehabilitation in the field is complicated by environmental stresses which may be particularly acute in degraded, destabilized soils with harsh climatic conditions at the soil surface. In this study, we first present the results of a field trial at a severely degraded rangeland site examining the stabilizing effects of various soil amendments (polysaccharide glues and polyacrylamides) in combination with biocrust inoculum. We found that a psyllium compound was the only amendment to maintain effectiveness after 19 months, and the only treatment that maintained biocrust inoculum throughout the trial. In a subsequent short‐term experiment where plots were shaded and watered, we examined how biocrust inoculation rate (0, 20, and 40% initial cover) and the psyllium‐based amendment affected biocrust growth. After 4 months, visible biocrust cover in inoculated plots was greater than in controls, but only chlorophyll a exhibited a dosage‐response to inoculum application rate, indicating preferential establishment of cyanobacteria. Psyllium did not affect biocrust development but did improve soil stability. Shade and watering buffered against temperature extremes (up to 15°C) and increased the duration of moist surface conditions necessary for biocrust growth by up to 30%, mimicking conditions more common in the fall and winter months. Our results suggest that inducing early successional biocrusts on a highly degraded site is possible with suitable microclimate conditions.