In this study we investigate the impact of nitrogen (N) deposition on the diversity of three different vegetation functional groups – forbs, grasses and mosses – using a field survey of acid grasslands across Great Britain. Our aim is to identify the vegetation types that are most vulnerable to enhanced N deposition, and to shed light on the mechanisms that may be driving N-initiated species changes in the UK. Sixty-eight randomly selected grasslands belonging to the UK National Vegetation Classification group U4 (Festuca ovina–Agrostis capillaris–Galium saxatile grassland) were studied along a gradient of atmospheric N deposition ranging from 6 to 36 kg N ha−1 yr−1. At each site, vegetation was surveyed and samples were taken from the topsoil and subsoil. Aboveground plant material was collected from three species: a forb, grass and moss. Both the species richness and cover of forbs declined strongly with increasing N deposition, from greater than eight species/20% cover per m2 quadrat at low levels of N to fewer than two species/5% cover at the highest N deposition levels. Grasses showed a weak but significant decline in species richness, and a trend toward increasing cover with increasing N input. Mosses showed no trends in either species richness or cover. Most of the decline in plant species richness could be accounted for by the level of ammonium deposition. Soil KCl-extractable ammonium concentration showed a significant positive correlation with N input, but there was no relationship between N deposition and extractable nitrate. In the soil O/A horizon, there was no relationship between N deposition and %N, and only a very weak positive relationship between the level of N deposition and the C : N ratio. Finally, in the vegetation, there was no relationship between N deposition and either shoot tissue N concentration or N : P ratio for any of the three reference species. Combining our regional survey with the results of published N-addition experiments provides compelling evidence that there has been a significant decline in the species richness and cover of forbs across Great Britain, and that the primary cause is competition due to an increase in the cover of grasses in response to enhanced deposition of reactive N, primarily NH4+.