As climate change increases fire frequency in Mediterranean-type shrublands, it is essential to understand the links between common postfire plant assemblages and soil nitrogen (N) and carbon (C) cycling during succession. In California chaparral, periodic fire removes shrub cover, deposits ammonium (NH4+-N) on soils, and allows herbaceous assemblages to dominate for 3–5 years. Herbs influence soil biogeochemistry through several mechanisms, including nutrient uptake, litter decomposition, and rhizodeposition. Controlled experimental removal of select plant groups from wild assemblages can demonstrate interactions between plant groups and how plant traits influence belowground processes. In a two-year herb-removal experiment, we investigated the impact of N-fixing and non-N-fixing herbs on soil N and C cycling. Treatments were (1) all herbs, (2) only non-N-fixing species, (3) only N-fixing species, and (4) no herbs. In high-N environments, N-fixers were predicted to compete poorly against non-N-fixing neighbors. N-fixers doubled in abundance when non-N-fixers were removed, but non-N-fixers were unaffected by N-fixer removal. Two years after fire, no-herbs plots had the lowest soil microbial respiration rates, and total accumulated C and N were lower than all-herb plots. Two treatments, no-herb and N-fixer plots, had elevated mineral N concentrations, net N mineralization, and net nitrification in the second year of the experiment. Our findings underscore the importance of fire-following herbs for postfire N retention and organic matter accumulation. A combination of both N-fixing and non-N-fixing herbs maximized total soil C and N, although the accumulation of TC and TN in all-herb plots was not significantly higher than in non-N-fixer plots. Results demonstrated the key role of non-N-fixing herbs in accumulating soil C and herbaceous communities for retaining N. Elevated soil nutrient availability two years postfire may contribute to the long-term recovery of shrubs, even after herbs are no longer dominant. Future investigations should also consider the magnitude of soil microbial N retention in plots with different herb functional groups, along with the species-specific contribution of non-N-fixing herbs to postfire C and N cycling.