The coordinated distribution of nitrogen to source leaves and sinks is essential for supporting leaf metabolism while also supplying sufficient nitrogen to seeds for development. This study aimed to understand how regulated amino acid allocation to leaves affects photosynthesis and overall plant nitrogen use efficiency in Arabidopsis (Arabidopsis thaliana) and how soil nitrogen availability influences these processes. Arabidopsis plants with a knockout of AAP2, encoding an amino acid permease involved in xylem-to-phloem transfer of root-derived amino acids, were grown in low-, moderate-, and high-nitrogen environments. We analyzed nitrogen allocation to shoot tissues, photosynthesis, and photosynthetic and plant nitrogen use efficiency in these knockout plants. Our results demonstrate that, independent of nitrogen conditions, aap2 plants allocate more nitrogen to leaves than wild-type plants. Increased leaf nitrogen supply positively affected chlorophyll and Rubisco levels, photosynthetic nitrogen use efficiency, and carbon assimilation and transport to sinks. The aap2 plants outperformed wild-type plants with respect to growth, seed yield and carbon storage pools, and nitrogen use efficiency in both high and deficient nitrogen environments. Overall, this study demonstrates that increasing nitrogen allocation to leaves represents an effective strategy for improving carbon fixation and photosynthetic nitrogen use efficiency. The results indicate that an optimized coordination of nitrogen and carbon partitioning processes is critical for high oilseed production in Arabidopsis, including in plants exposed to limiting nitrogen conditions.