Eucalypt management practices can affect the population dynamics of defoliating insects. To date, research has focused on how these practices alter eucalypt physiology and chemistry, which in turn affect canopy herbivores. Management practices such as irrigation and fertilisation, however, could also shape the understory plant community and potentially improve habitats for grass root-feeding scarab beetle larvae that later can become defoliators as adults. Using a large scale factorial field experiment comprising 2560 Eucalyptus saligna, we investigated the effects of irrigation and fertilisation on the understory ecology of a eucalypt plantation. We specifically focussed on grass communities and populations of scarab beetles and their natural enemies (entomopathogenic nematodes, EPNs). Irrigation and fertilisation increased grass coverage by 40% and 42%, respectively, and affected grass species composition. In particular, fertilisation favoured colonisation with C3 grasses (e.g. Microlaena stipoides) that have higher nitrogen concentrations over lower quality C4 grasses (e.g. Setaria incrassata). Fertilisation increased the nitrogen concentration of grasses by 30% on average. Scarab abundance increased by 52% in fertilised plots, potentially due to higher nutritional quality of host plants and the dominance of nutritionally superior species. Irrigation increased soil water content, but did not promote scarab larvae abundance. The presence of EPNs, however, was 78% higher in irrigated plots, which suggests scarab larvae populations may have been controlled by EPNs. This study illustrates how plantation management practices can affect understory communities of both plants and soil invertebrates with potential for creating 'reservoirs' of scarab beetle pests.