Agricultural systems that receive high amounts of inorganic nitrogen (N) fertilizer in the form of either ammonium (NH4+), nitrate (NO3−) or a combination thereof are expected to differ in soil N transformation rates and fates of NH4+ and NO3−. Using 15N tracer techniques this study examines how crop plants and soil microbes vary in their ability to take up and compete for fertilizer N on a short time scale (hours to days). Single plants of barley (Hordeum vulgare L. cv. Morex) were grown on two agricultural soils in microcosms which received either NH4+, NO3− or NH4NO3. Within each fertilizer treatment traces of 15NH4+ and 15NO3− were added separately. During 8 days of fertilization the fate of fertilizer 15N into plants, microbial biomass and inorganic soil N pools as well as changes in gross N transformation rates were investigated. One week after fertilization 45–80% of initially applied 15N was recovered in crop plants compared to only 1–10% in soil microbes, proving that plants were the strongest competitors for fertilizer N. In terms of N uptake soil microbes out-competed plants only during the first 4 h of N application independent of soil and fertilizer N form. Within one day microbial N uptake declined substantially, probably due to carbon limitation. In both soils, plants and soil microbes took up more NO3− than NH4+ independent of initially applied N form. Surprisingly, no inhibitory effect of NH4+ on the uptake and assimilation of nitrate in both, plants and microbes, was observed, probably because fast nitrification rates led to a swift depletion of the ammonium pool. Compared to plant and microbial NH4+ uptake rates, gross nitrification rates were 3–75-fold higher, indicating that nitrifiers were the strongest competitors for NH4+ in both soils. The rapid conversion of NH4+ to NO3− and preferential use of NO3− by soil microbes suggest that in agricultural systems with high inorganic N fertilizer inputs the soil microbial community could adapt to high concentrations of NO3− and shift towards enhanced reliance on NO3− for their N supply.