Restoring biological crust (biocrust) in disturbed drylands is challenging due to the difficult environmental conditions, such as limited soil moisture, low soil nutrients, and extreme temperatures, that impede growth. Understanding how the key components of biocrust—mosses, lichens, and cyanobacteria—react to different environmental factors informs the optimal timing, locations, and species composition for biocrust reintroduction, thereby increasing the likelihood of establishment. Here, we inoculated soils with a diverse range of biocrust organisms, analogous to seeding an area with diverse vascular plant seeds, and varied environmental conditions to observe how these changes influenced the development and functions of reintroduced biocrust. We found that by manipulating soil texture and time spent wet, we can change the proportional cover of biocrust within a restoration‐like setting. Specifically, we found that 4 months after inoculation, finer textured soils that received more water become dominated by moss cover, while coarser textured soils with less water remained dominated by cyanobacteria cover, and the interactions between texture and time spent wet strongly influenced cover. We found biocrust morphological group cover had a small, but detectable, effect on ecosystem functions (soil stability and nitrogenase activity, a proxy for nitrogen fixation), but that environmental conditions had a stronger impact on the functions we measured. Manipulative experiments in controlled environments, like this one, can help elucidate the mechanisms underlying the establishment rate and patterns of biocrusts post‐inoculation, and inform implementation of inoculations in the field.