Direct and indirect biotic interactions may affect plant growth and development, but the magnitude of these effects may vary depending on environmental conditions. In grassland ecosystems, competition is a strong structuring force. Nonetheless, if hemiparasitic plant species are introduced the competition intensity caused by the dominant species may be affected. However, the outcome of these interactions may change between wet or dry periods. In order to study this, we performed a pot experiment with different densities of the dominant species Schedonorus arundinaceus (1, 2 or 4 individuals) under constantly moist or intermittently dry conditions. The different Schenodorus densities were crossed with presence or absence of hemiparasites (either Rhinanthus minor or R. alectorolophus). Additionally, pots remained with bare ground or received a grass litter layer (400 g m(-2)). We expected that indirect litter effects on vegetation (here Schedonorus or Rhinanthus) vary depending on soil moisture. We measured Schedonorus and Rhinanthus aboveground biomass and C stable isotope signature (delta C-13) as response variables. Overall, Schedonorus attained similar biomass under moist conditions with Rhinanthus as in pots under dry conditions without Rhinanthus. Presence of Rhinanthus also increased delta C-13 in moist pots, indicating hemiparasite-induced water stress. Litter presence increased Schedonorus biomass and reduced delta C-13, indicating improved water availability. Plants under dry conditions with litter showed similar biomass as under wet conditions without litter. Hemiparasites and litter had opposite effects: hemiparasites reduced Schedonorus biomass while litter presence facilitated grass growth. Contrary to our expectations, litter did not compensate Schedonorus biomass when Rhinanthus was present.