Mugwort is a noxious perennial weed that interferes with the growth and establishment of crop species. The present study was designed to understand the role of allelopathy as a potential mechanism of interference by mugwort. Soils amended with mugwort plant material and leachates were analyzed for their chemical characteristics. The effect of amended soils on seedling growth of red clover was studied. The influence of NP fertilization and charcoal on modification of allelopathic potential of amended soils, in terms of their effect on soil characteristics and red clover seedling growth, was also investigated. In addition, red clover seedling growth was compared in sterilized and nonsterilized soils amended with mugwort leachate and NP fertilization. In general, addition of mugwort leachates and plant matter (amended soil) resulted in chemical changes in soil, including changes in available phenolics. Red clover seedling growth was reduced in amended soils, when compared to that in nonamended soils. Although the different amounts of NP fertilization in nonsterilized soil amended with mugwort leachate could not counteract its interference to red clover growth (root reduction, 67–79%; shoot reduction, 34–44%), the addition of charcoal did eliminate leachate effects on red clover growth. This indicates the probable allelopathic interference of mugwort to red clover growth. Addition of NP fertilization might have resulted in higher microbial activity, which is likely to influence qualitative and/or quantitative availability of phenolic compounds. Data on phenolic levels and red clover growth in sterilized and nonsterilized soil amended with mugwort leachate and NP fertilization indirectly indicate the significance of soil microbes in mugwort interference to red clover.