Invasive species that strongly modify their physical habitat are a particular management concern. Theoretical models predict that habitat modification could speed spread rates or allow invasion of sites that would otherwise resist invasion. There are few empirical tests of this hypothesis, however. We tested whether habitat modification by invading Spartina alterniflora populations facilitates conspecific seedling recruitment and spatial spread in Willapa Bay, WA, USA. Established S. alterniflora individuals strongly modified their local physical environment. Hydrologic flow, porewater salinity, and light availability were decreased while sediment NH4 increased with increasing S. alterniflora stem density. The S. alterniflora seed bank was greater and spring seedlings were denser within meadows of S. alterniflora than on unvegetated tideflats. However, almost all seedling recruitment after 1 year occurred on tideflats or on meadow edge plots where the above ground S. alterniflora biomass had been removed. Instead of facilitating invasive spread, ecosystem engineering in this system appears to create conditions that inhibit local seedling recruitment. These results suggest that the influence of ecosystem engineering on invasive spread is highly contingent on the relative spatial scales of habitat modification, environmental heterogeneity, and propagule availability. Control activities could change these spatial relationships, however, inadvertently promoting invasive recruitment.