Non-rainfall moisture (fog, dew, and water vapor; NRM) is an important driver of plant litter decomposition in grasslands, where it can contribute significantly to terrestrial carbon cycling. However, we still do not know whether microbial decomposers respond differently to NRM and rain, nor whether this response affects litter decomposition rates. To determine how local moisture regimes influence decomposer communities and their function, we examined fungal communities on standing grass litter at an NRM-dominated site and a rain-dominated site 75 km apart in the hyper-arid Namib Desert using a reciprocal transplant design. Dominant taxa at both sites consisted of both extremophilic and cosmopolitan species. Fungal communities differed between the two moisture regimes with environment having a considerably stronger effect on community composition than did stage of decomposition. Community composition was influenced by the availability of air-derived spores at each site and by specialization of fungi to their home environment; specifically, fungi from the cooler, moister NRM Site performed worse (measured as fungal biomass and litter mass loss) when moved to the warmer, drier rain-dominated site while Rain Site fungi performed equally well in both environments. Our results contribute to growing literature demonstrating that as climate change alters the frequency, magnitude and type of moisture events in arid ecosystems, litter decomposition rates may be altered and constrained by the composition of existing decomposer communities.