Ecological theory provides two contrasting predictions about the characteri
stics of the species combining to form communities. Classical competition t
heory states that they will be less similar than expected by chance, whilst
the environmental structuring hypothesis stales tl-lat they will be more s
imilar. We investigated these predictions by applying phylogenetic methods
of analysis (PICs) to a grassland community examining species on the basis
of their traits. At the scale of investigation most useful in making predic
tions about the presence and abundance of species (the community level), th
e species forming the community were more similar than would be expected by
chance. The use of PICs resulted in a more sensitive test than if phylogen
y had been ignored, allowing the detection of effects that would otherwise
have been overlooked or underestimated. Selected traits from the PICs analy
sis were used to develop a predictive model of community membership using d
iscriminant analysis. This correctly identified species in the pool which w
ere present in the community but failed to predict absences accurately impl
ying that dispersal limitation may operate in the community.