We investigated genetic differentiation among populations of the clonal grass Elymus athericus, a common salt-marsh species occurring along the Wadden Sea coast of Europe. While E. athericus traditionally occurs in the high salt marsh, it recently also invaded lower parts of the marsh. In one of the first analyses of the genetic population structure in salt-marsh species, we were interested in population differentiation through isolation-by-distance, and among strongly divergent habitats (low and high marsh) in this wind- and water-dispersed species. High and low marsh habitats were sampled at six sites throughout the Wadden Sea. Based on reciprocal transplantation experiments conducted earlier revealing lower survival of foreign genotypes we predicted reduced gene flow among habitats. Accordingly, an analysis with polymorphic cross-species microsatellite primers revealed significant genetic differentiation between high and low marsh habitats already on a very small scale (< 100 m), while isolation-by-distance was present only on larger scales (60–443 km). In an analysis of molecular variance we found that 14% of the genetic variance could be explained by the differentiation between habitats, as compared to only 8.9% to geographical (isolation-by-distance) effects among six sites 2.5–443 km distant from each other. This suggests that markedly different selection regimes between these habitats, in particular intraspecific competition and herbivory, result in habitat adaptation and restricted gene flow over distances as small as 80 m. Hence, the genetic population structure of plant species can only be understood when considering geographical and selection-mediated restrictions to gene flow simultaneously.