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Pictured is a Thuja plicata "Green Giant" that spent too much time in a container. Notice the foliage thinning near the bottom.

As the tree gets into better conditions and starts growing, will the missing foliage be replaced and thicken up here or will it always be noticeable, or should I just replace the tree?

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Nearly all conifers except yews do not replace dead foliage or small branches from the trunk or large branches. Arbs will occasionally resprout from the trunk, but this is never particularly good looking foliage and is always extremely slow. Leaf/branchlet loss on a young and small evergreen is not nearly as serious as it is on larger plants, however. This is because that as the tree or shrub grows, its new growth tends to fill in "blank" dead spots over a few years.

You plant should be just fine after it acclimatizes itself to its new location in the ground. In a couple of years you won't be able to tell that it ever had sparse growth.

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  • Should the brown foliage be removed?
    – Learning2Thumb
    Dec 2, 2020 at 21:11
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    It's just a matter of aesthetics. The foliage usually falls off by itself, but the shrubs/trees can look a bit ratty until it does (my very old and very tall T. occidentalis drop their brown foliage in September, just like a deciduous tree does its leaves). For small shrubs/trees that you might want to "neaten up", you can run gloved hands gently through the foliage to knock the brown ones off. This is easiest in fall and in early spring.
    – Jurp
    Dec 2, 2020 at 22:08

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