Allelopathy is an interference mechanism by which plants release chemicals which affect other plants; while it has often been proposed as a mechanism for influencing plant populations and communities, its acceptance by plant ecologists has been limited because of methodological problems as well as difficulties of relating the results of bioassays used for testing allelopathy to vegetation patterns in the field. Here we argue that the concept of allelopathy is more appropriately applied at the ecosystem-level, rather than the traditional population/community level of resolution. Firstly, we consider the wide ranging effects of secondary metabolites (widely regarded as allelochemicals) on organisms and processes which regulate ecosystem function, including herbivory, decomposition and nutrient mineralization. It is apparent that plants with allelopathic potential against other organisms induce net changes in ecosystem properties, which may in turn impact upon the plant community in the longer term. We then illustrate these concepts using two contrasting examples of how invasive plant species with allelopathic potential may alter ecosystem properties through the production of secondary metabolites, i.e. Carduus nutans (nodding thistle) in New Zealand pastures and Empetrum hermaphroditum (crowberry) in Swedish boreal forests. In both cases the production of secondary metabolites by the invasive species induces important effects on other organisms and key processes, which help determine how the ecosystem functions and ultimately the structure of the plant community. These examples help demonstrate that the concept of allelopathy is most effectively applied at the ecosystem-level of resolution, rather than at the population-level (i.e. plant-plant interference).