This study aimed to identify indicator species and explore the most important environmental and management variables contributing to vegetation distribution in a hilly upper dam landscape in Zagros Mountain chain, Iran. A stratified random sampling method was used to collect topographic, edaphic, management and vegetation data. The density and cover percentage of perennial species were measured quantitatively. Indicator species were identified using the two-way indicator species analysis. Besides calculating physiognomic factors in sample sites, 24 soil samples were collected from 0 to 30 cm of soil depth and analyzed in terms of gravel percentage, texture, saturation moisture, organic matter, pH and electrical conductivity in saturation extract, lime percentage, soluble calcium and magnesium, available phosphorus, Cation Exchange Capacity (CEC) and soluble sodium and potassium. Multivariate techniques including Canonical Correspondence Analysis and Multi-Dimensional Scaling were used to explore the relationships of species with environmental and management variables. Seven plants were identified as indicator species due to being significantly correlated with management (grazing or non-grazing) and edaphic variables such as CEC, soil texture, pH, CaCO3 percentage and physiographic variable including slope, elevation, and convex and concave formations (p < 0.05). Overall, overgrazing and its subsequent effects on soil characteristics, loss of vegetation cover and trampling were found as the major causes of deterioration. Sustainable and integrated management practices such as the implementation of appropriate grazing systems were suggested to enhance soil quality and reduce the accelerated erosion in upper dam zones. https://link.springer.com/article/10.1007/s11629-018-5184-y