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Eucalyptus tetrodonta, a co-dominant tree species of tropical, northern Australian savannas, does not invade adjacent monsoon rain forest unless the forest is burnt intensely. Such facilitation by fire of seedling establishment is known as the "ashbed effect." Because the ashbed effect might involve disruption of common mycorrhizal networks, we hypothesized that in the absence of fire, intact rain forest arbuscular mycorrhizal (AM) networks inhibit E. tetrodonta seedlings. Although arbuscular mycorrhizas predominate in the rain forest, common tree species of the northern Australian savannas (including adult E. tetrodonta) host ectomycorrhizas. To test our hypothesis, we grew E. tetrodonta and Ceiba pentandra (an AM-responsive species used to confirm treatments) separately in microcosms of ambient or methyl-bromide fumigated rain forest soil with or without severing potential mycorrhizal fungus connections to an AM nurse plant, Litsea glutinosa. As expected, C. pentandra formed mycorrhizas in all treatments but had the most root colonization and grew fastest in ambient soil. E. tetrodonta seedlings also formed AM in all treatments, but severing hyphae in fumigated soil produced the least colonization and the best growth. Three of ten E. tetrodonta seedlings in ambient soil with intact network hyphae died. Because foliar chlorosis was symptomatic of iron deficiency, after 130 days we began to fertilize half the E. tetrodonta seedlings in ambient soil with an iron solution. Iron fertilization completely remedied chlorosis and stimulated leaf growth. Our microcosm results suggest that in intact rain forest, common AM networks mediate belowground competition and AM fungi may exacerbate iron deficiency, thereby enhancing resistance to E. tetrodonta invasion. Common AM networks-previously unrecognized as contributors to the ashbed effect-probably help to maintain the rain forest-savanna boundary.