We report that in many ecosystems, global changes are likely to profoundly affect microorganisms. In Southern California, changes in precipitation and nitrogen deposition may influence the composition and functional potential of microbial communities and their resulting ability to degrade plant material. To test whether such environmental changes impact the distribution of functional groups involved in leaf litter degradation, we determined how the genomic diversity of microbial communities in a semi-arid grassland ecosystem changed under reduced precipitation or increased N deposition. We monitored communities seasonally over a period of 2 years to place environmental change responses into the context of natural variation. Fungal and bacterial communities displayed strong seasonal patterns, Fungi being mostly detected during the dry season whereas Bacteria were common during wet periods. Most putative cellulose degraders were associated with 33 bacterial genera and predicted to constitute 18% of the microbial community. Precipitation reduction reduced bacterial abundance and cellulolytic potential whereas nitrogen addition did not affect the cellulolytic potential of the microbial community. Finally, we detected a strong correlation between the frequencies of genera of putative cellulose degraders and cellulase genes. Thus, microbial taxonomic composition was predictive of cellulolytic potential. This work provides a framework for how environmental changes affect microorganisms responsible for plant litter deconstruction.