Abstract Besides environmental sorting, other processes like biotic interactions and dispersal limitation are vital for the assembly of plant communities in high mountains and their re‐assembly under changing climatic conditions. Nevertheless, studies that compare the impact of these factors on plant community assembly above the tree line are largely lacking so far. We analysed occurrence changes in vascular plant communities of 492 permanent 1‐m2 plots in the alpine‐nival ecotone of Mt. Schrankogel, Austrian Alps by comparing resurvey data from 2014 with data from the initial survey in 1994. We combined these data with species inventories from 899 additional plots sampled in 2021 and 2022 across a larger landscape above the tree line covering an elevational range of 1700 m, which we used for fine‐scale habitat suitability modelling. We assessed the relative effects of projected habitat suitability, propagule pressure from surrounding populations and biomass density of neighbours on 1532 colonization and 372 extirpation events of 31 species observed on the permanent plots. We found that all three factors are significantly related to both colonisations and extirpations, with habitat suitability having the strongest, propagule pressure a slightly weaker, and vegetation density the weakest effect. Colonisations can be better explained by the three process proxies than extirpations. Our results indicate a crucial role of dispersal limitation besides the predominant effect of environmental filtering on the (re‐)assembly of the alpine‐nival plant community, while competitive/facilitative effects between plants tend to play a minor role. The strong imprint of nearby source plant populations on colonization/extirpation events suggests that recent plant migrations predominantly occur in small steps. This implies that while the topographically complex alpine terrain offers climatic microrefugia for plants, it may also pose potential barriers, hindering species from following their suitable climatic niches upwards. Synthesis: Besides filtering by environmental conditions dispersal limitation had a strong effect on the observed changes in a local alpine plant community over two decades. Limited dispersal capacities of plant species may counteract the ability of isolated cold areas to effectively shelter high alpine plants from the effects of climate warming.