Invaded systems are commonly associated with a change in ecosystem processes and a decline in native species diversity; however, many different causal pathways linking invasion, ecosystem change, and native species decline could produce this pattern. The initial driver of environmental change may be anthropogenic, or it may be the invader itself; and the mechanism behind native species decline may be the human-induced environmental change, competition from the invader, or invader-induced environmental change (non-trophic effects). We examined applicability of each of these alternate pathways in Great Lakes coastal marshes invaded by hybrid cattail (Typha x glauca). In a survey including transects in three marshes, we found that T. x glauca was associated with locally high soil nutrients, low light, and large amounts of litter, and that native diversity was highest in areas of shallow litter depth. We tested whether live T. x glauca plants or their litter induced changes in the environment and in diversity with a live plant and litter transplant experiment. After one year, Typha litter increased soil NH4+ and N mineralization twofold, lowered light levels, and decreased the abundance and diversity of native plants, while live Typha plants had no effect on the environment or on native plants. This suggests that T. x glauca, through its litter production, can cause the changes in ecosystem processes that we commonly attribute to anthropogenic nutrient loading and that T. x glauca does not displace native species through competition for resources, but rather affects them non-trophically through its litter. Moreover, because T. x glauca plants were taller when grown with their own litter, we suggest that this invader may produce positive feedbacks and change the environment in ways that benefit itself and may promote its own invasion.