Grazing is one of the prevalent human activities that even today are taking place inside protected areas with direct or indirect effects on ecosystems. In this study we analyzed the effects of grazing on plant species diversity, plant functional group (PFG) diversity and community composition of shrublands. We analyzed plant diversity data from 582 sampling plots located in 66 protected areas of the Greek Natura 2000 network, containing in total 1102 plant species and subspecies. We also classified a priori all plant species in seven PFGs: annual forbs, annual grasses/sedges, legumes, perennial forbs, perennial grasses/sedges, small shrubs and tall shrubs. For each site, grazing intensity was estimated in four classes (no grazing, low, medium and high grazing intensity). We found that, at the spatial and temporal scale of this study, as grazing intensity increased, so did total species richness. However, each PFG displayed a different response to grazing. Shortlived species (annual grasses or forbs and legumes) benefited from grazing and their species richness and proportion in the community increased with grazing. Perennial grasses and forbs species richness increased with grazing intensity, but their dominance decreased, since their proportion in the community declined. Short shrub species richness remained unaffected by grazing, while tall shrub diversity decreased. Finally, in sites without grazing the spatial pattern of species richness of the different PFGs was not congruent with each other, while in grazed sites they were significantly positively correlated (with the exception of tall shrubs). This finding may imply that grazing is a selective pressure organizing the community structure, and imposing a certain contribution of each PFG. So, in Mediterranean shrublands in protected areas with a long historical record of grazing, it seems that grazing promotes species diversity and its continuation on a portion of the landscape may be a necessary part of an effective management plan.