Since humans began settling in Iceland and removing native vegetation, the natural volcanically-derived soils have been rapidly eroding. Today, Iceland has one of the world’s most heavily damaged landscapes (Arnalds 2001). In the mid-1960’s, in an effort to combat widespread erosion, the Icelandic Forestry Service began planting small afforestation sites of Nootka Lupin (Lupinus nootkatensis) to strengthen and reinforce the soil with the plants’ dense root mats. Nootka Lupin, a nitrogen-fixer, thrived in the volcanic, nitrogen-deficient soils and quickly began out-competing the native heathland flora (Magnusson 2010). The spread of L. nootkatensis has been rapid but little is known about the ecological consequences of lupin dominance in native heath habitats. A field study conducted in Northeast Iceland consisting of 32 established plots on the front of encroaching lupin stands aims to discover the invasive effects of lupin on the surrounding plant and invertebrate species. By analyzing soil core dry weight and combustion data, as well as conducting a plant survey, it was discovered that increasing amounts of lupin decreases soil water and organic matter content and greatly affects plant community structure. The effect of L. nootkatensis on invertebrate diversity was measured using data collected from pitfall traps. The proportion of a plot containing lupin correlated directly with Staphylinidae, Carabidae, and Opiliones abundances and inversely with Lycosidae abundances within the plot. Fertilizer effects on invertebrate diversity were also discovered: the addition of sulfur and nitrogen fertilizers led to greater Staphylinidae and lower Opiliones abundances inside plots.