The effect of disturbance by agricultural development on plant biodiversity was assessed on a broad development gradient in three major New Zealand tussock grassland types. We compared undeveloped, semi‐developed, and pastorally developed snow tussock (Chionochloa rigida) grasslands in Otago; fescue tussock (Festuca no‐vae‐zelandiae) grasslands in Canterbury; and red tussock (C. rubra) grasslands in the central North Island volcanic plateau. Plant diversity and structure were measured using height‐frequency transects. The effect of disturbance by spring and summer burning was similarly assessed in coastal and inland Otago snow tussock grasslands. Non‐metric multidimensional scaling ordination showed agricultural development had the greatest effect on plant communities, reducing indigenous plant species diversity and dominance, and increasing adventive plant species dominance. Spring and summer burning significantly reduced indigenous plant species diversity in the montane coastal Otago snow tussock grassland, but spring burning did not significantly decrease total or indigenous plant diversity in the inland alpine grassland. For biodiversity conservation in tussock grasslands it is critical that representative lower altitude areas are retained, and that tall tussock grasslands should only be burnt when retaining sufficient moisture to minimise fire impact. The quantitative determination of the effects of these disturbance factors will assist further investigation of vegetation‐fauna interactions, and tussock grassland ecosystem studies.