Exotic grasses are widely established across the Southeastern United States for livestock forage, resulting in the structural and compositional simplification of grasslands. Replacing exotic forages with native warm‐season grasses (NWSG) could benefit insects due to increased complexity of plant structure and composition, but livestock grazing also may facilitate spread of remnant exotic grasses such as bermudagrass (Cynodon dactylon) by reducing height and coverage of NWSG. We investigated these relationships among 12 operational‐scale pastures (6.4–10.5 ha) in Mississippi, U.S.A., during May–July (2011–2012). We quantified changes in bermudagrass coverage from one treatment of grazed exotic forages and three treatments of recently established NWSG, including a grazed mixed NWSG polyculture, a grazed Indian grass (Sorghastrum nutans) monoculture to evaluate the effects of stand‐type richness among NWSG pastures, and a non‐grazed NWSG polyculture to evaluate the effects of grazing. We also assessed responses of two insect orders, Orthoptera and Hemiptera, to treatment and bermudagrass coverage. We estimated a 101–190% average increase in coverage of bermudagrass in grazed native grass pastures (NWSG polyculture and Indian grass monoculture), but not in non‐grazed NWSG, suggesting that grazing facilitated the spread of this grass. Composition of Orthopteran and Hemipteran communities was correlated with bermudagrass coverage, and inter‐year differences in composition for both communities in grazed mixed NWSG, and for Hemiptera in grazed Indian grass, corresponded with increasing bermudagrass coverage in those treatments. Our results suggest that incomplete eradication of exotic forages prior to establishment of NWSG may be exacerbated by grazing, which could then impact stand condition and insect communities.