It is often thought that the coexistence of plants and plant diversity is determined by resource heterogeneity of the abiotic environment. However, the presence and heterogeneity of biotic plant resources, such as arbuscular mycorrhizal fungi (AMF), could also affect plant species coexistence. In this study, Brachypodium pinnatum and Prunella vulgaris were grown together in pots and biotic resource heterogeneity was simulated by inoculating these pots with one of three different AMF taxa, with a mixture of these three taxa, or pots remained uninoculated. The AMF acted as biotic plant resources since the biomass of plants in pots inoculated with AMF was on average 11.8 times higher than uninoculated pots. The way in which the two plant species coexisted, and the distribution of phosphorus and nitrogen between the plant species, varied strongly depending on which AMF were present. The results showed that the composition of AMF communities determines how plant species coexist and to which plant species nutrients are allocated. Biotic plant resources such as AMF should therefore be considered as one of the factors that determine how plant species coexist and how soil resources are distributed among co-occurring plant species. © New Phytologist (2003).