Increased biological nitrogen fixation (BNF) by legumes has been reported following biochar application to soils, but the mechanisms behind this phenomenon remain poorly elucidated. We investigated the effects of different biochar application rates on BNF in red clover (Trifolium pratense L.). Red clover was grown in mono or mixed cultures with red fescue grass (Festuca rubra L.) and plantain (Plantago lanceolata L.) at a range of different biochar application rates (0, 10, 50 and 120 t ha−1). In a separate experiment, nutrient effects of biochar on BNF were investigated using nitrogen, phosphorous and potassium (N, P and K) and micronutrient fertilization using the same plant species. Biochar addition increased BNF and biochar applied at a rate of 10 t ha−1 led to the highest rate of BNF. Total biomass also showed the greatest increase at this application rate. An application rate of 120 t ha−1 significantly decreased biomass production in both single and mixed cultures when compared to the control, with the greatest reduction occurring in red clover. Furthermore, BNF was significantly higher in pots in which red clover was grown in mixed cultures compared to monocultures. In the absence of biochar, K fertilization caused a significant increase in BNF. For N, P, and micronutrient fertilization, BNF did not significantly differ between treatments with and without biochar addition. We conclude that different biochar application rates lead to different effects in terms of BNF and biomass production. However, due to the high variety of biochar properties, different application rates should be investigated on a case specific basis to determine the optimum biochar application strategies.