Productivity of tropical and subtropical grasslands is often limited by inadequate nitrogen (N) supply. Aeschynomene (Aeschynomene americana L.) is a warm‐season legume that may contribute as N input in grazing systems, but there is limited information about aeschynomene litter decomposition and N dynamics on pastures. The objective of this study was to quantify the effect of overseeding aeschynomene or applying N fertilizer to existing bahiagrass (Paspalum notatum Flüggé) on litter disappearance and decomposition rates. The study was conducted in Ona, FL, from October 2019 to May 2020 and October 2020 to May 2021. Treatments were the split‐plot arrangement of bahiagrass‐aeschynomene or bahiagrass monoculture (main plot) and N fertilization level, (0 [control] or 60 kg N ha−1) as subplot, distributed in a randomized complete block design with four replicates. The nylon bag technique was used to estimate organic matter (OM), N and carbon (C) disappearance, and lignin concentration for 184 days of incubation. Bahiagrass‐aeschynomene had greater OM disappearance (from 330 to 356 g kg−1 OM) and was driven by C disappearance. Nitrogen fertilization did not impact litter decomposition responses, except for C:N ratio. Overseeding aeschynomene is an effective management practice to increase OM decomposition and optimize nutrient cycling in warm‐season pastures.