Amendment of forest soils with dewatered dairy factory sludge (DDFS), characterized by low heavy metal contents and high amounts of degradable C, can prevent the depletion of soil nutrients that results from intensive harvesting in forest plantations. However, this practice involves environmental risks when N supplies exceed the demand of plants or when the strong acidity of the soil favors the mobility of trace metals. Th ese aspects were assessed in a young radiata pine plantation growing in a sandy, acidic, and organic N-rich soil for the 7 yr after application of a DDFS. Th e supply of limiting nutrients (mainly P, Mg, and Ca) provided by application of the DDFS, along with control of the ground vegetation, improved the nutritional status of the stand and led to increases in timber volume of more than 60 to 100%. Increases in soil inorganic N were observed during the fi rst months after amendment. Data from soil incubation experiments revealed that some of the additional N was immobilized and, to a lesser extent, denitrifi ed due to the readily available organic C content of the DDFS. Leaching and increased plant uptake of N were prevented by a combination of the latter processes and the low rate of nitrifi cation. The strong acidity of the soil enhanced the availability of Mn and Zn to plants, although the maximum concentrations did not reach levels harmful to organisms. We conclude that although application of DDFS has positive eff ects on tree nutrition and growth and the environmental risks are low, repeated application may favor mobility of N and availability of heavy metals.