Much theoretical evidence has demonstrated that a trade-off between competitive and dispersal ability plays an important role in facilitating species coexistence. However, experimental evidence from natural communities is still rare. Here, we tested the competition-dispersal trade-off hypothesis in an alpine grassland in the Tianshan Mountains, Xinjiang, China, by quantifying competitive and dispersal ability using a combination of 4 plant traits (seed mass, ramet mass, height, and dispersal mode). Our results show that the competition-dispersal trade-off exists in the alpine grassland community and that this pattern was primarily demonstrated by forbs. The results suggest that most forb species are constrained to be either good competitors or good dispersers but not both, while there was no significant trade-off between competitive and dispersal ability for most graminoids. This might occur because graminoids undergo clonal reproduction, which allows them to find more benign microenvironments, forage for nutrients across a large area and store resources in clonal structures, and they are thus not strictly limited by the particular resources at our study site. To the best of our knowledge, this is the first time the CD trade-off has been tested for plants across the whole life cycle in a natural multispecies plant community, and more comprehensive studies are still needed to explore the underlying mechanisms and the linkage between the CD trade-off and community composition.