That competition is stronger among closely related species and leads to phylogenetic overdispersion is a common assumption in community ecology. However, tests of this assumption are rare and field-based experiments lacking. We tested the relationship between competition, the degree of relatedness, and overdispersion among plants experimentally and using a field survey in a native grassland. Relatedness did not affect competition, nor was competition associated with phylogenetic overdispersion. Further, there was only weak evidence for increased overdispersion at spatial scales where plants are likely to compete. These results challenge traditional theory, but are consistent with recent theories regarding the mechanisms of plant competition and its potential effect on phylogenetic structure. We suggest that specific conditions related to the form of competition and trait conservatism must be met for competition to cause phylogenetic overdispersion. Consequently, overdispersion as a result of competition is likely to be rare in natural communities.