In monoculture, certain plant species are able to preferentially utilize different nitrogen (N) forms, both inorganic and organic, including amino acids and peptides, thus forming fundamental niches based on the chemical form of N. Results from field studies, however, are inconsistent: Some showing that coexisting plant species predominantly utilize inorganic N, while others reveal distinct interspecies preferences for different N forms. As a result, the extent to which hypothetical niches are realized in nature remains unclear. Here, we used in situ stable isotope tracer techniques to test the idea, in temperate grassland, that niche partitioning of N based on chemical form is related to plant productivity and the relative availability of organic and inorganic N. We also tested in situ whether grassland plants vary in their ability to compete for, and utilize peptides, which have recently been shown to act as an N source for plants in strongly N-limited ecosystems. We hypothesized that plants would preferentially use NO3--N and NH4+-N over dissolved organic N in high-productivity grassland where inorganic N availability is high. On the other hand, in low-productivity grasslands, where the availability of dissolved inorganic N is low, and soil availability of dissolved organic N is greater, we predicted that plants would preferentially use N from amino acids and peptides, prior to microbial mineralization. Turves from two well-characterized grasslands of contrasting productivity and soil N availability were injected, in situ, with mixtures of 15N-labeled inorganic N (NO3- and NH4+) and 13C15N labeled amino acid (l-alanine) and peptide (l-tri-alanine). In order to measure rapid assimilation of these N forms by soil microbes and plants, the uptake of these substrates was traced within 2.5 hours into the shoots of the most abundant plant species, as well as roots and the soil microbial biomass. We found that, contrary to our hypothesis, the majority of plant species across both grasslands took up most N in the form of NH4+, suggesting that inorganic N is their predominant N source. However, we did find that organic N was a source of N which could be utilized by plant species at both sites, and in the low-productivity grassland, plants were able to capture some tri-alanine-N directly. Although our findings did not support the hypothesis that differences in the availability of inorganic and organic N facilitate resource partitioning in grassland, they do support the emerging view that peptides represent a significant, but until now neglected, component of the terrestrial N cycle. This study used 15N-labelled NO3- and NH4+ and 13C15N-labelled amino acid and peptide to test the idea, in temperate grassland, that niche partitioning of N based on chemical form is related to plant productivity and the availability of IN. We found NH4+ to be the predominant N source for the majority of plant species across both grasslands, although DON was an important source of N for plant species at both sites, and in the low productivity grassland, Luzula sp. were able to capture peptide-N directly. Although our findings did not support the hypothesis that differences in the availability of DIN and DON facilitate resource partitioning in grassland, they do support the emerging view that peptides represent a significant, but until now neglected, component of the terrestrial N cycle.