Introduction Defoliation and light competition are ubiquitous stressors that can strongly limit plant performance. Tolerance to defoliation is often associated with compensatory growth, which could be positively or negatively related to plant growth. Genetic variation in growth, tolerance and compensation, in turn, plays an important role in the evolutionary adaptation of plants to changing disturbance regimes but this issue has been poorly investigated for long-lived woody species. We quantified genetic variation in plant growth and growth parameters, tolerance to defoliation and compensation for a population of the understorey palm Chamaedorea elegans. In addition, we evaluated genetic correlations between growth and tolerance/compensation. Methods We performed a greenhouse experiment with 711 seedlings from 43 families with twelve or more individuals of C. elegans. Seeds were collected in southeast Mexico within a 0.7 ha natural forest area. A two-third defoliation treatment (repeated every two months) was applied to half of the individuals to simulate leaf loss. Compensatory responses in specific leaf area, biomass allocation to leaves and growth per unit leaf area were quantified using iterative growth models. Results We found that growth rate was highly heritable and that plants compensated strongly for leaf loss. However, genetic variation in tolerance, compensation, and the individual compensatory responses was low. We found strong correlations between family mean growth rates in control and defoliation treatments. We did not find indications for growth-tolerance/ compensation trade-offs: genetic correlation between tolerance/compensation and growth rate were not significant. Implications The high genetic variation in growth rate, but low genetic variation in tolerance and compensation observed here suggest high ability to adapt to changes in environment that require different growth rates, but a low potential for evolutionary adaptation to changes in damage or herbivory. The strong correlations between family mean growth rates in control and defoliation treatments suggest that performance differences among families are also maintained under stress of disturbance.