Climate change can affect the process of carbon cycling and leaf litter decomposition in multiple ways, both directly and indirectly, though the strength and direction of this relationship is often context dependent. In this experiment, we followed decomposition of a standard litter type-senescent leaves of Fagus sylvatica collected from a single location-along a 1000 m altitudinal gradient of four sites over 2.5 years. To control the edaphic conditions, we transplanted intact turf mesocosms from three different land-use types [densely wooded, sparsely wooded, and unwooded (UW) pastures] from the highest altitude site into UW pastures along the altitudinal gradient from the moist, cool high-elevation site to the dry, warm low-elevation site, using shade cloth to mimic the light conditions in the original habitats. Decomposition in the drier UW pasture mesocosms increased with altitude, likely because of higher moisture at the highest sites. Decomposition in the more mesic mesocosms from sparsely and densely wooded sites was insensitive to altitude, suggesting an overriding moisture, rather than temperature, constraint on decomposition across these sites. The functional composition of decomposer microbial communities (fungal/bacterial ratio) was similarly insensitive to altitude. Our findings bring substantial evidence for the controlling role of soil moisture on litter decomposition, as well as for the indirect effects of climate through changes in the decomposer community.