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Concerted use of legumes and of functional diversity in grassland forage systems can provide major contributions to the challenges of agricultural systems being productive yet environmental friendly. Acquisition and transformation of nitrogen (N) resources by legumes and grasses were studied in a temperate grassland experiment near Zurich (Switzerland) to investigate mechanisms driving effects of functional diversity in mixed swards and to optimise mixtures for efficient resource use. Grass–legume interactions and N availability were varied by manipulating legume percentage of the sward (0–100%) and N fertiliser application (50, 150 or 450kgofNha⁻¹year⁻¹). ¹⁵N technology quantified N derived from symbiotic (Nsym) and non-symbiotic (Nnonsym) sources. Generally, acquisition of Nsym by the entire mixture was stimulated by grasses. As a result, strong overyielding of Nsym occurred (e.g. 75 and 114% for …