Functional characters have the potential to act as indicators of species turnover between local communities. Null models provide a powerful statistical approach to test for patterns using functional character information. A combined null model/functional character approach provides the ability to distinguish between the effect of competition and environmental filtering on species turnover. We measured 13 functional characters relating directly to resource use for the fish species found in French lakes. We combined this functional character data with a null model approach to test whether co-occurring species overlapped more or less than expected at random for four primary niche axes. We used an environmentally constrained null model approach to determine if the same mechanisms were responsible for species turnover at different sections of the altitudinal gradient. Functional diversity indices were used to examine the variation in functional character diversity with altitude, as a test of the hypothesis that competitive intensity decreases with increasing environmental adversity. The unconstrained null model showed that environmental filtering was the dominant influence on species turnover between lakes. In the constrained null model, there was much less evidence for environmental filtering, emphasising the strong effect of altitude on turnover in functional character values between local communities. Different results were obtained for low-altitude and high-altitude lake subsets, with more evidence for the effect of environmental filtering being found in the high-altitude lakes. This demonstrates that different processes may influence species turnover throughout an environmental gradient. Functional diversity values showed a slight decrease with altitude, indicating that there was only weak evidence that competitive intensity decreased with increasing altitude. Variation resource availability and environmental stress probably cause the observed turnover in functional characters along the altitudinal gradient, though the effects of dispersal limitation and species introductions in high-altitude lakes cannot be ruled out.