Hyptis suaveolens (L.) Poit is an important invader of the tropical and sub-tropical regions of the world. In our study, it has been investigated that how does the H. suaveolens invasion regulate plant species diversity across the seasons in the dry tropical grassland. We hypothesized that a shift in soil inorganic-N availability is caused by invasion, and this shift is integral to access the invasion effect on plant diversity. The study was performed in experimental plots at the Botanical Garden of the Banaras Hindu University (25°16′3.3″ N and 82°59′22.7″ E), Varanasi, Uttar Pradesh, India. Five replicates (each, 2 × 2m) of non-invaded grassland plots (NIG) and five grassland plots invaded with H. suaveolens (IG) were established. These plots were constructed by transplanting indigenous grassland patches from an adjacent native grassland. In the invaded plots, 20 individuals of H. suaveolens were transplanted per plot. After 1 year of establishment, diversity attributes and soil properties were recorded from these plots in three seasons as per standard protocol. The results indicated that Hyptis invasion negatively affects plant diversity, with relatively higher impact in rainy season as compared to the winter season. IG exhibited lower soil moisture content and temperature than NIG in rainy season, whereas soil ammonium-N, nitrate-N, total inorganic-N, N mineralization registered higher values for IG than NIG in both rainy and winter season. Diversity indices were negatively correlated with soil inorganic-N pool and N mineralization. However, these indices were positively correlated with microbial biomass carbon (MBC), and the correlation coefficient for this relationship was higher for rainy season as compared to winter. Species richness (r = 0.65) and Shannon diversity (r = 0.757) were significantly correlated with the ratio of ammonium-N to nitrate-N. The negative effect of invasion by H. suaveolens on the plant diversity is possibly mediated by the effect of invasion on N mineralization processes (mainly nitrification) and the availability of soil inorganic-N pools. The study indicates that Hyptis invasion has an enormous potential to change the structure and composition of plant communities in the dry tropical grasslands.