Abstract Plant-microbial competition for nutrients is considered to be a strong mechanism affecting nutrient distribution in subarctic ecosystems, but the role of grazers on the distribution of nutrients between the plants and soil microorganisms remain poorly understood. We designed a factorial fertilization and clipping experiment to study the potential competition between plants and soil microorganisms for soil nitrogen in an ecosystem under grazing. We assumed that clipping reduces plant photosynthetic capacity and C flux to the soil, which ultimately results in lower microbial substrate availability and reduced potential for N immobilization. In concurrence with microbial substrate availability, increased nutrient availability through fertilization was expected to enhance microbial N in the unclipped but not in the clipped treatment. Clipping significantly reduced microbial respiration, suggesting that grazing reduces the labile C available for soil microbes in the system. Clipping had no effect on microbial C and N and the amount of NH 4-N captured in ion exchange resin bags, which was used as an index of net N mineralization. Microbial potential for N immobilization thus seemed insensitive to grazer-mediated changes in microbial availability of labile substrates. Fertilization had no effects or interactions with clipping on microbial C and N. By contrast, we found a close negative correlation between the plant root biomass and microbial N, indicating that plants had a negative impact on the microbial nutrient acquisition. The subarctic grassland vegetation seemed superior to the soil microorganisms in the competition for nutrients even when the plants were subjected to artificial grazing. We suggest that nutrient competition by higher plants constrained the microbial N immobilization in the system, which could explain why the reduction in microbial C availability by clipping had little effects on microbial N acquisition. In this subarctic system, grazing has significant influences on soil C cycling, but due to plant predominance in the competition for nutrients, does not affect N allocation between the plants and the soil microorganisms.