The atmospheric N-depositions cause acidification and eutrophication in the ecosystems resulting into reduction in soil fertility, alteration in community composition and loss in biodiversity, because each ecosystem has a limit to the amount of N that it can occupy; beyond this threshold, the ecosystem may collapse. Information on the effects of N deposition on the soil and vegetation from the dry tropical environment of India are lacking In conclusion, the study indicates that N-treatment showed humped-back pattern for the N-mineralization and species diversity and thus alteration in community composition. Further, N-treatment also caused considerable variations in functional group diversity, seed size and leaf traits. The medium seed size category had maximum number of species and individuals and small seed size category had minimum species and individuals. The number of species within large seed size trait category decreased with increased dose of N. The moderate level of N had greater SLA and LNC, and comparatively less LDMC, suggesting greater resource availability at moderate level of N which supported maximum herbaceous diversity. Thus the study supported N-saturation model.