Plant invasions likely impact entire arthropod communities but most research focuses either on insect controls or select target plant species. In Western Montana, USA, vegetation and arthropod communities were compared between intermountain grassland habitats uninvaded by spotted knapweed (Centaurea stoebe) and habitats corresponding with increasing levels of invasion. Arthropods were sampled using a diverse array of sampling methods. Arthropod data were analyzed both at the community and trophic level. Native plant species richness and percent cover values were significantly different between uninvaded and invaded habitats, but no differences were observed in plant diversity and evenness. Invasion by C. stoebe did not reduce arthropod morphospecies diversity estimates. Overall arthropod abundance however and proportional abundance by trophic level were significantly influenced by extent of invasion. Arthropod detritivores, predators, and biological control herbivores were positively related to higher levels of invasion by C. stoebe whilst native herbivores and omnivores responded negatively. Further, invasion by C. stoebe altered arthropod species assemblages suggesting that this weed impacts arthropod community organization. Centaurea stoebe likely impacts intermountain grassland plants and arthropods through both direct and indirect pathways dependent on the trophic level. This case study explores some of these potential interaction pathways and illustrates the profound and likely permanent impacts an exotic plant species will have on an ecosystem. Importantly, arthropods are excellent bioindicators of impacts related to plant invasions in grassland systems.