Forest encroachment into grasslands is a widespread phenomenon with significant implications for land management. We examined the influence of seed dispersal and predation on the encroachment of two tree species, Lithocarpus densiflora and Pseudotsuga menziesii, into a coastal California grassland. We mapped the distributions of L. densiflora and P. menziesii seedlings and saplings and L. densiflora acorns across the forest-grassland ecotone as well as quantified the fates of seeds of both species experimentally located at five distances across the ecotone. Species distributions varied, with P. menziesii being most abundant in the grassland and at the edge and L. densiflora in the forest. Lithocarpus densiflora acorns were absent from the grassland but equally abundant at the edge and forest. Seed predation was similar for both species, being low in the grassland, variable at the edge, and high in the forest. It appears that L. densiflora encroachment into the grassland is strongly influenced by seed dispersal, while P. menziesii encroachment is more likely influenced by seed predation than dispersal.