Summary Grasslands of the Swiss Alps provide agricultural goods, ecological services, disaster protection, and scenic beauty. We identified influences of site conditions and management type on grassland biodiversity, and specifically evaluated the effectiveness of the agri-environmental programme in the Alps. Vascular plants and grasshoppers were mapped in conventionally managed cut meadows, cut meadows of the ecological compensation programme (ECA meadows), and conventionally managed pastures ( n=324). We determined climatic and topographic site conditions, quantified the degree of remoteness of all plots in GIS, and estimated the habitat diversity in the vicinity of the sampling sites. The data were analysed by discriminant analysis, rank-correlation analysis, non-parametric ANOVA, general linear models, and ANCOVA. Plant biodiversity hot spots were in economically unattractive, remote sites. These were the typical site conditions of ECA meadows. Hence we concluded that the ecological compensation programme was effectively ensuring management at these sites, and thus protecting mountain grassland plant species richness. Grasshoppers seemed not to benefit from mountain ECA meadows, which were probably often situated at the climatic limit of several species. Pastures were the most species rich management type (plants and grasshoppers), but conversion from cut grassland to pastures should be limited, as negative economic and ecological effects have been reported. We propose that the co-existence of well-managed pastures and long-term ECA meadows might best conserve mountain grassland biodiversity.