Artificial chalk grassland swards were exposed to either ambient air or air enriched to 600 μmol mol–1 CO2, using free-air CO2 enrichment technology, and subjected to an 8 week simulated grazing regime. After 14 months of treatment, ribulose-1,5-bisphosphate carboxylase (Rubisco) activity (Vc,max) and electron transport mediated ribulose-1,5-bisphosphate (RuBP) regeneration capacity (Jmax), estimated from leaf gas exchange, were significantly lower in fully expanded leaves of Anthyllis vulneraria L. (a legume) and Sanguisorba minor Scop. grown in elevated CO2. After a change in source:sink balance brought about by defoliation, photosynthetic capacity was fully restored in A. vulneraria and S. minor, but acclimation continued in the grass Bromopsis erecta (Hudson) Fourr. Changes in net photosynthesis (Pn) with growth at elevated CO2 ranged from a 1·6% reduction in precut leaves of A. vulneraria to a 47·1% stimulation in postcut leaves of S. minor. Stomatal acclimation was observed in leaves of A. vulneraria (reduced stomatal density) and B. erecta (reduced stomatal conductance). The results are discussed in terms of whole-plant resource-use optimization and chalk grassland community competitive interactions at elevated CO2.