The woody C-3 Prosopis glandulosa (honey mesquite) and C-4 perennial grass Schizachyrium scoparium (little bluestem) were grown along a gradient of daytime carbon dioxide concentrations from near 340 to 200 mu mol/mol air in a 38 m long controlled environment chamber. We sought to determine effects of historical and prehistorical increases in atmospheric CO2 concentration on growth, resource use, and competitive interactions of a species representative of C-4-dominated grasslands in the southwestern United States and the invasive legume P. glandulosa. Increasing CO2 concentration stimulated N-2 fixation by individually grown P. glandulosa and elicited in C-3 seedlings a similar relative increase in leaf intercellular CO2 concentration, net assimilation rate, and intrinsic water use efficiency (leaf net assimilation rate/stomatal conductance). Aboveground biomass of P. glandulosa was not altered by CO2 concentration, but belowground biomass and whole-plant water and nitrogen use efficiencies increased linearly with CO2 concentration in seedlings that were grown alone. Biomass produced by P. glandulosa that was grown with S. scoparium was not affected by CO2 concentration. Stomatal conductance declined and leaf assimilation rates of S. scoparium at near maximum incident light increased at higher CO2 concentration, but there was no effect of CO2 concentration on biomass production or whole-plant water use efficiency of the C-4 grass. Rising CO2 concentration, especially the 27% increase since the beginning of the 19th century, may have contributed to more abundant P. glandulosa on C-4 grasslands by stimulating the shrub's growth or reducing the amount of resources that the C-3 required. Much of the potential response of P. glandulosa to CO2 concentration, however, appears to be contingent on the shrub's escaping competition with neighboring grasses.