Identifying drivers of species diversity is a major challenge in understanding and predicting the dynamics of species-rich semi-natural grasslands. In particular in temperate grasslands changes in land use and its consequences, i.e. increasing fragmentation, the on-going loss of habitat and the declining importance of regional processes such as seed dispersal by livestock, are considered key drivers of the diversity loss witnessed within the last decades. It is a largely unresolved question to what degree current temperate grassland communities already reflect a decline of regional processes such as longer distance seed dispersal. Answering this question is challenging since it requires both a mechanistic approach to community dynamics and a sufficient data basis that allows identifying general patterns. Here, we present results of a local individual- and trait-based community model that was initialized with plant functional types (PFTs) derived from an extensive empirical data set of species-rich grasslands within the 'Biodiversity Exploratories' in Germany. Driving model processes included above- and belowground competition, dynamic resource allocation to shoots and roots, clonal growth, grazing, and local seed dispersal. To test for the impact of regional processes we also simulated seed input from a regional species pool. Model output, with and without regional seed input, was compared with empirical community response patterns along a grazing gradient. Simulated response patterns of changes in PFT richness, Shannon diversity, and biomass production matched observed grazing response patterns surprisingly well if only local processes were considered. Already low levels of additional regional seed input led to stronger deviations from empirical community pattern. While these findings cannot rule out that regional processes other than those considered in the modeling study potentially play a role in shaping the local grassland communities, our comparison indicates that European grasslands are largely isolated, i.e. local mechanisms explain observed community patterns to a large extent. © 2014 The Authors.