Competition and herbivory are two major factors that can influence plant growth and plant defence. Although these two factors are often studied separately, they do not operate independently. We examined how aboveground herbivory by beet armyworm larvae (Spodoptera exigua) and belowground herbivory by wireworms (Agriotes lineatus) influenced competition between the plant species Jacobaea vulgaris and Leucanthemum vulgare exposed to three competition levels (no, intra-, and interspecific competition). In addition, we studied the effects of herbivory and competition on pyrrolizidine alkaloid (PA) concentrations in leaves of J. vulgaris. For J. vulgaris, aboveground herbivory significantly reduced shoot biomass while belowground herbivory increased root biomass. Biomass of L. vulgare was not affected by herbivory. Competition caused a reduction in biomass for both plant species, but herbivory did not affect the outcome of the competition. However, competition significantly influenced the amount of leaf damage experienced by the plants. A L. vulgare plant had significantly less damage from aboveground herbivores when grown together with J. vulgaris than when grown alone or in intraspecific competition, while a J. vulgaris plant experienced lowest damage in conditions of intraspecific competition. The total PA concentration in J. vulgaris leaves was highest for plants exposed to interspecific competition. Root herbivory caused an increase in the relative concentration of N-oxides, the less toxic form of PAs, in leaves of plants that were grown without competition, but a decrease in plants exposed to competition. Our study shows that competition and herbivory but also the type of competition and whether herbivory occurs above- or belowground, all influence plant performance. However, overall, there was no evidence that herbivory affects plant–plant competition.