Grazing by large herbivores affects the composition of established vegetation and seed banks. Montane Pampas grasslands are highly productive and have evolved with the influence of grazing by native herbivores. Thus we proposed, firstly that grazing by feral horses would increase seed bank diversity, without changing seed density in grazed areas and secondly that there is a greater similarity between the seed bank and aboveground vegetation in exclosure areas. The study area is located in sub-humid montane grassland in mid-eastern Argentina. Sampling took place at the beginning and end of summer in 2008 and 2009, in three one-year-old exclosures and grazed areas. Soil and litter samples were collected and established vegetation cover was visually recorded in every area. Each sample was elutriated and sieved. Seed composition was recorded using a dissecting microscope. Seed density and species richness of the samples was analyzed using ANOVA and species composition was analyzed by multivariate analysis. Grazing reduces the seed density and richness of grasses, but forb species are not affected. The seed density of grasses increases in soil samples at the end of summer, while the density of forb species does not change. Similarity between the established vegetation and the seed bank was low. Grazing affects seed bank composition which could limit restoration time after the removal of herbivores. However, grass seed availability increases considerably during a short period after exclosure establishment, showing high potential for recovery in sub-humid grasslands.