Plant-soil feedbacks are widely recognized as playing a significant role in structuring plant communities through their effects on plant-plant interactions. However, the question of whether plant-soil feedbacks can be indirectly driven by other ecological agents, such as large herbivores, which are known to strongly modify plant community structure and soil properties, remains poorly explored. We tested in a glasshouse experiment how changes in soil properties resulting from long-term sheep grazing affect competitive interactions (intra- and inter-specific) of two graminoid species: Nardus stricta, which is typically abundant under high sheep grazing pressure in British mountain grasslands; and Eriophorum vaginatum, whose abundance is typically diminished under grazing. Both species were grown in monocultures and mixtures at different densities in soils taken from adjacent grazed and ungrazed mountain grassland in the Yorkshire Dales, northern England. Nardus stricta performed better (shoot and root biomass) when grown in grazing-conditioned soil, independent of whether or not it grew under inter-specific competition. Eriophorum vaginatum also grew better when planted in soil from the grazed site, but this occurred only when it did not experience inter-specific competition with N. stricta. This indicates that plant-soil feedback for E. vaginatum is dependent on the presence of an inter-specific competitor. A yield density model showed that indirect effects of grazing increased the intensity of intra-specific competition in both species in comparison with ungrazed-conditioned soil. However, indirect effects of grazing on the intensity of inter-specific competition were species-specific favouring N. stricta. We explain these asymmetric grazing-induced effects on competition on the basis of traits of the superior competitor and grazing effects on soil nutrients. Finally, we discuss the relevance of our findings for plant community dynamics in grazed, semi-natural grasslands. © 2012 Springer-Verlag.