Impacts of atmospheric nitrogen (N) deposition on soil carbon (C) dynamics are highly variable, and the underlying mechanisms remain unclear. This limits our ability to predict soil responses to climate change. Labile-fraction soil organic matter (LF-SOM), which is the earliest-responding indicator of soil changes, was examined to investigate SOM dynamics on a Tibetan alpine steppe in response to N addition at six levels (0, 10, 20, 40, 80 and 160 kg⋅N⋅ha⁻¹⋅yr⁻¹) after 2 and 5 years. LF-SOM fingerprints (pyrolysis-gas chromatography/tandem-mass spectrometry) combined with microbial community data (high-throughput sequencing) were used to explore LF-SOM responses to N addition and their drivers. LF-SOM showed accumulation (N10–N20) and decomposition (N40–N160) in the 2nd year of N addition but only decomposition (N10–N160) in the 5th year. Organic compounds in LF-SOM showed high sensitivity (90% significant correlations with the N level) but low resistance (0.38 resistance index) and low sensitivity (no significant correlation) but high resistance (0.48) to the N level in the 2nd year and 5th year, respectively. Abiotic and biotic factors showed higher sensitivity to the N level in the 2nd year (more than 70% significant correlations) than in the 5th year (approximately 20% significant correlations), and biotic factors showed higher resistance (0.83) to the N level in the 5th year than in the 2nd year (0.73). Abiotic factors, mainly the soil C/N balance, were the primary drivers of LF-SOM transformation in the 2nd year, while biotic factors, primarily microbes, were the main drivers of LF-SOM decomposition in the 5th year. Our study demonstrated that the variable impacts of N deposition on LF-SOM transformation depended on shifts in the responses of abiotic and biotic factors to N accumulation. This understanding is significant for predicting terrestrial ecosystem functions under future N deposition.