Herbivores have strong impacts on marine and terrestrial plant communities, but their impact is less well studied in benthic freshwater systems. For example, North American beavers (Castor canadensis) eat both woody and non-woody plants and focus almost exclusively on the latter in summer months, yet their impacts on non-woody plants are generally attributed to ecosystem engineering rather than herbivory. Here, we excluded beavers from areas of two beaver wetlands for over 2 years and demonstrated that beaver herbivory reduced aquatic plant biomass by 60%, plant litter by 75%, and dramatically shifted plant species composition. The perennial forb lizard's tail (Saururus cernuus) comprised less than 5% of plant biomass in areas open to beaver grazing but greater than 50% of plant biomass in beaver exclusions. This shift was likely due to direct herbivory, as beavers preferentially consumed lizard's tail over other plants in a field feeding assay. Beaver herbivory also reduced the abundance of the invasive aquatic plant Myriophyllum aquaticum by nearly 90%, consistent with recent evidence that native generalist herbivores provide biotic resistance against exotic plant invasions. Beaver herbivory also had indirect effects on plant interactions in this community. The palatable plant lizard's tail was 3 times more frequent and 10 times more abundant inside woolgrass (Scirpus cyperinus) tussocks than in spatially paired locations lacking tussocks. When the protective foliage of the woolgrass was removed without exclusion cages, beavers consumed nearly half of the lizard's tail leaves within 2 weeks. In contrast, leaf abundance increased by 73-93% in the treatments retaining woolgrass or protected by a cage. Thus, woolgrass tussocks were as effective as cages at excluding beaver foraging and provided lizard's tail plants an associational refuge from beaver herbivory. These results suggest that beaver herbivory has strong direct and indirect impacts on populations and communities of herbaceous aquatic plants and extends the consequences of beaver activities beyond ecosystem engineering.