Molecular approaches have revealed considerable diversity and uncultured novelty in natural prokaryotic populations, but not direct links between the new genotypes detected and ecosystem processes. Here we describe the influence of the structure of communities of ammonia-oxidizing bacteria on nitrogen cycling in microcosms containing natural and managed grasslands and amended with artificial sheep urine, a major factor determining local ammonia concentrations in these environments. Nitrification kinetics were assessed by analysis of changes in urea, ammonia, nitrite and nitrate concentrations and ammonia oxidizer communities were characterized by analysis of 16S rRNA genes amplified from extracted DNA using ammonia oxidizer-specific primers. In natural soils, ammonia oxidizer community structure determined the delay preceding nitrification, which depended on the relative abundance of two Nitrosospira clusters, termed 3a and 3b. In batch cultures, pure culture and enrichment culture representatives of Nitrosospira 3a were sensitive to high ammonia concentration, while Nitrosospira cluster 3b representatives and Nitrosomonas europaea were tolerant. Delays in nitrification occurred in natural soils dominated by Nitrosospira cluster 3a and resulted from the time required for growth of low concentrations of Nitrosospira cluster 3b. In microcosms dominated by Nitrosospira cluster 3b and Nitrosomonas, no substantial delays were observed. In managed soils, no delays in nitrification were detected, regardless of initial ammonia oxidizer community structure, most probably resulting from higher ammonia oxidizer cell concentrations. The data therefore demonstrate a direct link between bacterial community structure, physiological diversity and ecosystem function.