Ammonia-oxidizing and denitrifying microorganisms in agricultural soil are the key players in determining the fate of nitrogen (N). Grasslands are important in cool-climate agricultural systems and are managed with various combinations of N fertilization and plant species. We established a three-year (2013-2015) field study in southern Finland with fertilizer treatment as a main-plot factor, including , organic and synthetic fertilizers and plant species and mixtures thereof as sub-plot factor. We quantified six genes encoding key N-cycling enzymes by quantitative PCR to determine the abundance of the communities involved in N-transfomation processes and also included previsouly published data on crop yield, soil properties and the overall bacterial community composition. With the exception of ammonia oxidizing bacteria (AOB), which were primarily affected by fertilization, the abundances of all other N cycling communities changed over time. Differences between plant species treatments and from fertilizer and plant species interactions were mainly detected in the beginning of the cropping season in June 2014, with the abundances of respiratory ammonification and denitrifer communities being lower in pure red clover plots than in mixtures and pure timothy plots, especially when no fertilizer was applied. The nirS -type denitrifiers and nosZ II nitrous oxide reducers responded more to changes in soil properties than their functional counterpart nirK and nosZ I communities. Using structural equation modeling, we show that management practices affected the important N-cycling functions indirectly and the microbial community played an important role in mediating the management effects on crop yield, potential N retention and N 2 O sink capacity. The genetic potential for soil N retention correlated positively with crop yield, although only indirectly, and a trade-off between N 2 O sink and N retention capacity was detected. In conclusion, we found a potential for managing agriculture towards sustainability through managing soil microbial communities.