In Australia, environmental plantings using native trees and shrubs have been established to restore agricultural landscapes affected by land degradation. We studied a chronosequence of environmental plantings established between 1993 and 2005, adjacent to pasture and remnant woodland at three study areas on contrasting soil types in New South Wales. Our aim was to assess the effects of environmental plantings on soil properties and microbial attributes and to determine if the recovery to the conditions found under extant remnant woodland were achievable. We examined total organic carbon (TOC), total nitrogen (TN), extractable phosphorus (P), soil pH, electrical conductivity (EC), and changes in microbial functional diversity and activity across the pasture, environmental plantings of different ages and remnant woodlands. Microbial functional diversity, determined using MicroResp™, differed between pasture and environmental plantings, and between environmental plantings and the remnant woodland soil. Ordination distances of microbial functional diversity declined by 7%–36% between environmental plantings and remnant woodland as the age of the environmental planting increased (microbial functionality in plantings becoming similar to that under remnant with increasing age). This result indicated a trajectory of recovery in soil microbial function through time. TOC, TN, P, C:N and EC were positively correlated with microbial activity at all sites. Although TOC and TN levels remained similar under environmental plantings compared to pasture, P levels increased under environmental plantings and with increasing planting age. These results suggest that the environmental plantings had not attained the same functions and nutrient status under their canopies as the remnant woodland soils, but their condition was on a trajectory of change from that of the pasture systems toward that of the remnant vegetation. Therefore, establishment of environmental plantings on degraded lands is an approach that can successfully enhance soil microbial recovery.