Soil incubation studies were undertaken in controlled environment cabinets at 15°C to investigate the effect of increasing application rates of calcium ammonium nitrate (CAN) on net nitrification in two grassland soils. Granular CAN was applied to the surface of freshly collected, moist soil, at a rate equivalent to 0, 100, 200, 400, 800 and 1600µg NH 4 + -N and NO 3 - -N per gram of oven dry soil. In half the treatments finely ground CaCO3 was incorporated into the moist soil to raise the starting pH. Changes in soil mineral N and pH were measured at weekly intervals up to six-weeks. The most probable number (MPN) technique was used to enumerate the NH 4 + -N and NO 2 - -N oxidizers at the beginning and end of the incubation. At low rates of CAN application there was considerable NH 4 + -N oxidation to NO 3 - -N during the incubation of both soils. Lime stimulated this N transformation. At high application rates (i.e. 800 and 1600 ppm) there was little change in NH 4 + -N or NO 3 - -N on either soil during the 6 week incubation, in the presence or absence of lime. The rate of NO 3 - -N produced peaked at 5.6 and 3.8 mg NO 3 - -N kg−1 d−1 on soil 1 and 2 respectively, in the presence of lime. Above a level of 400 ppm CAN (equivalent to 38 kg N ha−1) the rate of NO 3 - -N produced decreased. The higher rate of net nitrification in soil 1 compared with soil 2 was probably due to a higher number of nitrifying bacteria. Although high rates of CAN decreased the nitrifying activity of both soils there was little difference between treatments in the actual numbers of NH 4 + -N and NO 2 - -N oxidizers determined by the MPN technique. The results showed that the rate of granular CAN applied to the soil surface can influence the local activity of nitrifying bacteria and subsequent N transformations. At application rates of CAN generally used agriculturally for grass production, it is likely that net nitrification of the NH 4 + -N in the fertilizer granule will be inhibited.