The role of competition, coexistence and co-evolution in the formation of plant communities is discussed, particularly in relation to the breeding of improved grass/legume mixtures. Competition occurs whenever the demand for a particular resource outstrips supply, with the pressures generated within a species expected to exceed those between species. These pressures must be withstood before populations can coexist within a community. This is accomplished by a process of niche diversification, arising from temporal or spatial differences between the populations, that enables them to draw on resources not readily available to their competitors. Coexistence is crucial to the success of any breeding programme designed to raise the productivity of grass/ legume pastures, because it enables components to adapt not only to the environment which they share, but also to each other. A strategy that improves the "general ecological combining ability" of one or both components by a process of recurrent or reciprocal recurrent unilateral adaptation may prove successful, particularly if existing niche differences are increased thereby. Although both processes may give rise to populations which have apparently coevolved, only those resulting from reciprocal recurrent selection will meet the criteria of specificity and reciprocity.