Questions: Biocrusts perform critical functional roles in drylands, where they are regulated predominantly by differences in climate and soils. We asked whether biocrust cover and composition differ among sites of varying vegetation cover and condition. Location: Subhumid drylands in the Namoi Region, eastern Australia. Methods: We assessed the effects of different vegetation strata (trees, shrubs, groundcover) and site vegetation condition (index of quality based on vascular plant richness, and the proportion of perennial and native vascular plants) on the cover, richness and composition of biocrust communities at 43 sites in semi-arid eastern Australia. Results: Woody plant cover at our sites was negatively related to biocrust cover and richness, but there was only a weak relationship between groundstorey plant cover and biocrusts, suggesting that woody plants are not facilitating biocrusts in this environment. Conversely, greater site condition was strongly associated with richer and more extensive biocrust communities, likely driven by a common response to livestock grazing intensity. There was also a significant multivariate association between biocrust composition and vegetation condition. For example, sites of poorer condition were occupied by generalist taxa, typically short mosses and squamulose lichens, while sites in better condition were characterised by a richer assemblage that included foliose and fruticose lichens, and taller, disturbance-sensitive mosses. Conclusions: Our study provides empirical evidence of the negative relationship between woody plant cover and biocrusts (amensalism), and the filtering effect of vegetation condition on different biocrust taxa. Predicted drier climates could enhance biocrust dominance by suppressing woody plant growth, while intensified land-use disturbances are likely to filter biocrust specialists such as fruticose and foliose lichens that are associated with sites in better condition.