Intraspecific trait variation (ITV) plays a potentially important role in determining functional community composition across environmental gradients. However, the importance of ITV varies greatly among studies, and we lack a coherent understanding of the contexts under which to expect a high vs. low contribution of ITV to trait-environment matching among communities. Here we first elaborate a novel conceptual framework posing specific hypotheses and predictions about the environmental and ecological contexts underlying the contribution of ITV to community trait turnover. We then empirically test these predictions in understory herbaceous plant communities in a montane environment, for three functional traits (flowering phenology, specific leaf area, and height). We found that different components of trait variation mapped onto different environmental axes, specifically reporting a greater contribution of ITV along non-climatic axes (e.g., soil properties, light) than along the main climatic axis (i.e., elevation), as predicted by the hypothesis that phenotypic plasticity (a major source of ITV) is greatest in response to conditions varying at a small spatial scale. Based on a variant of the niche-variation hypothesis, we predicted that the importance of ITV would be greatest in the lowest-diversity portion of the elevational gradient (i.e., at high elevation), but this prediction was not supported. Finally, the generally strong intraspecific responses to the gradient observed across species did not necessarily give rise to a high contribution of ITV (or vice versa) given (1) an especially weak or strong response of a dominant species driving the community-level trend, (2) differences among species in the direction of trait-environment response cancelling out, or (3) relatively narrow portions of the gradient where individual species abundances were high enough to have an important impact on community-level trait means. Our research identifies contexts in which we can predict that local adaptation and phenotypic plasticity will play a relatively large role in mediating community-level trait responses to environmental change.