In systems where low temperatures limit plant productivity, facilitative effects of surrounding vegetation on juvenile plants may outweigh effects of competition for resources. This facilitation could occur through temperature buffering but also via increased availability of root mutualists such as mycorrhizal fungi. Climate warming could cause this balance between facilitation and competition to shift. We investigated how first-year plant performance, biomass allocation, and mycorrhizal colonization were affected by neighboring vegetation, both under ambient temperatures and under experimental warming. We planted juveniles of the grass species Festuca ovina L. (Poaceae) into an alpine tundra ecosystem in central Norway, into one of four microsite types: a moss and lichen layer, other graminoids, both groups, or neither (bare soil). Half of the microsites experienced ambient conditions and half were located within open-top warming chambers. Warming increased shoot biomass of F. ovina, but only when neighbors were not present (i.e., when planted in bare soil). Our results suggest that when abiotic stress was reduced by warming, the importance of competition among F. ovina juveniles and neighboring vegetation increased, in line with the stress gradient hypothesis. These results indicate that climate warming may shift the balance from facilitation to competition among plants in cold ecosystems, although the resource(s) competed for is (are) yet to be identified. We also found that when moss and lichen were present, planted F. ovina were more likely to form mycorrhizae, yet had a significantly lower root biomass, both absolute and relative to their total biomass. Thus, at the juvenile stage, belowground competition and/or increased mycorrhization may decrease plant root production yet without detectable benefits to aboveground growth. Keywords: alpine tundra, bryophyte, competition, experimental warming, facilitation, mycorrhizae, plant–fungal interactions, plant-microbial, tundra.