Abstract Nitrogen (N) deposition drives nonlinear ecosystem responses, yet the underlying below‐ground mechanisms that govern functional tipping points remain poorly understood. We conducted an in situ 15 N labelling experiment using NO 3 − and NH 4 + across six N addition levels (0–32 g N m −2 year −1 , designated N0–N32) in an alpine grassland on the Qinghai–Tibetan Plateau. Total biomass increased with N addition up to moderate N levels (N8) before reaching a plateau, while total plant N uptake peaked early (N2) at 3086 mg N m −2 and declined thereafter, revealing a decoupling between structural growth and functional N acquisition. Notably, plants exhibited a transient shift in N form preference from NH 4 + to NO 3 − under low N addition (N2), concurrent with a decline in microbial N uptake (484 mg N m −2 ) and a similar shift in their preference. These patterns intensified plant–microbial competition for NO 3 − at N2 but weakened subsequently at higher N levels. Synthesis . Our results demonstrate a threshold shift in N acquisition strategies that precedes biomass saturation. We propose that N form preference patterns and associated shifts in plant–microbial competition can serve as early‐warning indicators of ecosystem N saturation, providing mechanistic insights to improve threshold‐based nutrient management in alpine grasslands.