Invasion by the African grass Andropogon gayanus is drastically altering the understory structure of oligotrophic savannas in tropical Australia. We compared nitrogen (N) relations and phenology of A. gayanus and native grasses to examine the impact of invasion on N cycling and to determine possible reasons for invasiveness of A. gayanus. Andropogon gayanus produced up to 10 and four times more shoot phytomass and root biomass, with up to seven and 2.5 times greater shoot and root N pools than native grass understory. These pronounced differences in phytomass and N pools between A. gayanus and native grasses were associated with an altered N cycle. Most growth occurs in the wet season when, compared with native grasses, dominance of A. gayanus was associated with significantly lower total soil N pools, lower nitrification rates, up to three times lower soil nitrate availability, and up to three times higher soil ammonium availability. Uptake kinetics for different N sources were studied with excised roots of three grass species ex situ. Excised roots of A. gayanus had an over six times higher uptake rate of ammonium than roots of native grasses, while native grass Eriachne triseta had a three times higher uptake rate of nitrate than A. gayanus. We hypothesize that A. gayanus stimulates ammonification but inhibits nitrification, as was shown to occur in its native range in Africa, and that this modification of the soil N cycle is linked to the species' preference for ammonium as an N source. This mechanism could result in altered soil N relations and could enhance the competitive superiority and persistence of A. gayanus in Australian savannas.