Central European grasslands with low land-use intensity potentially harbor high biodiversity, but have decreased in extent due to land-use intensification. We evaluated the success of a 30-year grassland restoration project on former arable fields in comparison to old permanent grassland in a floodplain in North Germany, taking into account the effects of land-use intensity and habitat connectivity. We analyzed restoration success by richness and abundance of target species groups of vascular plants and butterflies. Restoration was successful in establishing common plant species of agricultural grasslands. However, restoration failed to recover plant species of wet grasslands with respect to both richness and cover, which may be explained by the lack of wet site conditions on former arable fields. In general, higher land-use intensity reduced species richness and cover of mesotrophic and wet-grassland plants, while smaller distances to old permanent grassland increased richness of all but wet-grassland species. Butterfly species, including grassland specialists and red-list species, were favored by high cover of flowering forbs and, coherent to this, low land-use intensity. Surprisingly, higher cover of old permanent grassland in the surrounding landscape decreased species richness of butterflies, possibly due to a dilution effect. In conclusion, we recommend recreating wet microsites and introducing seeds of specialist and rare forbs for better restoration success, in addition to sowing of diverse seed mixtures. It is also important to keep land-use intensity low to allow for higher cover of host and nectar plants, which is vitally important for promoting butterflies, especially grassland specialists and red-list species.