<p>In this study, we examined the effect of a nitrogen-fixing shrub <em>Coriaria nepalensis</em> Wall on herb species composition, diversity and biomass. The effect was measured in terms of species richness, diversity and biomass of herb species in three sites varying in <em>Coriaria</em> density viz. site 1 (low <em>Coriaria</em> density; 20 ha^-1), site-2 (medium <em>Coriaria</em> density; 120 ha^-1) and site-3 (high <em>Coriaria</em> density 190 ha^-1).&nbsp; Species richness was minimum at Site-1 (16 species), and maximum at site-2 (27 species).<em> G. aparine </em>dominated site-1 and <em>Arthraxon sp</em> dominated site-2 and 3. The individual herb density ranged between 0.40 - 42.40 m^-2, and total herb density ranged between 138- 170.4 m^-2 and was maximum at site-2. Value for species richness (27) and Shannon Index (3.72) was highest for medium <em>Coriaria</em> density site and lowest for low <em>Coriaria</em> density site. Simpson Index ranged between 0.11 and 0.14 and was lowest for site-2(medium <em>Coriaria</em> density) indicating that at this the dominance was shared by many species. Along the gradient of <em>Coriaria </em>density, maximum biomass was recorded at site-3 with highest <em>Coriaria</em> density and lowest at site-2 with medium <em>Coriaria</em> density. This may be due to the symbiotic nitrogen fixing ability of <em>Coriaria</em> that improve the habitat quality. The facilitative effect of <em>C. nepalensis</em> in terms of soil amelioration and herb growth can be used to regenerate degraded forest ecosystems.</p>