This is the reason , maximum plant diversity is observed unuunduunder mid-altitudes representing humid tropical/ subtropical climate..

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Nice articles Arvind.

I would also consider taking the question from an environmental filtering prospective: as resources decrease along a resource gradient the number of species with functional traits compatible with lower resources also decreases. Not an expert on altitudinal gradients but we found a similar response along an aridity gradient. see "Environmental filtering drives community specific leaf area in Spanish forests and predicts relevant changes under future climatic conditions"

Altitude can alter environmental variables which in turn can affect biodiversity 

Here in the southern Appalachians my observation is that plant species mixture changes with altitude.  At about  1000 meters there is an abrupt shift to more boreal like forests in where biodiversity decreases dramatically. 

Altitudinal gradients concentrate diversity of environmental conditions, habitats and species in space and for that reason mountain areas are usually very rich in species and often target areas for conservation. Some of these species have a very high conservation value because they are endemic or rare for phylogeographic reasons. Some times higher richness in mountains results from the condition of ecosystems that tend to be better preserved here than in lowlands. This is quite different from considering that altitude increases richness.

Altitude influences phenology, which indirectly influences carbon balance, ecosystems, and climatic change.  

On species richness in endemic herbs along a Mediterranean to arctic.alpine elevation gradient, please see attached. Various theories are discussed against the findings (Island theory; mid-attitudinal peak). In the same area the diversity in woody/tree species peaks at much lower elevation (sub-Mediterranean), only including a single endemic and at a much lower level compared to herbs (unpublished). 

Article Fine resolution distribution modelling of endemics in Majell...

Please have a look at my attached document folks.

Frank

Yes, the classic pattern in humid regions where the whole altitudinal range has had a similar history of evolution in the last 2 million years is a reduction in species with altitude, e.g., the slopes of the Alps. However, if the climate changes from seasonally dry, e.g., the Mediterranean areas to humid temperate, the pattern will be different. Complete glaciation can produce a fresh start in humid mountains such as British Columbia resulting in the classic decrease with altitude, but the Neoglacial was much more snowy along the continental divide on the Alberta-British Columbia border so that more plants could flourish. The end of the Neoglacial event has resulted in about half the species that were dependent on the deep winter snow to prevent them freezing have retreate to the refugium around Sunshine Village where there has not been so large a reduction in winter snow pack. Given the altitudinal sequence from the arid grasslands of the prairies to the mountain tops at Sunshine along the Bow River Valley entrance to the Cordillera, there is a spectacular increase in plant diversity with altitude as a result of the existence of this refugium.

The conclusion is that all parts of the microenvironments affecting plant diversity along the altitudinal gradient need to be sufficiently consistent along the transect to produce the classic pattern. Climate is just one of the factors but the changes over time, relationship to centres of development of endemic plants, etc., are also involved. Increasingly, Man is modifying conditions in the lowlands destroying plant diversity there as in the Prairies, or introducing new species as in New Zealand. In Canada, 40% of the vascular plants in Nova Scotia are introduced from Europe, whereas only about 4 introduced species are found along the continental divide in Alberta.

Stuart.

for tree, it is generally decreasing along the increase of elevation

This reference is important L. Olsvig-Whittaker. M. Shachak & A. Yair. Vegetation Patterns related to enviromental factors in Negev Desert watersed (54: 153-165) and other document of Whittaker.

i AGREE WITH CHEN, IN SRI lANKA ALSO HIGH BIODIVERSITY IN LOWLAND FOREST (LOW ELEVATION) AND COMPARATIVELY LESS DIVERSE IN MONTAIN REGION.

Interesting discussion ..

Area, Altitude and Aquatic Plant Diversity byJ. Iwan Jones, Wei Li and Stephen C. MaberlyEcographyVol. 26, No. 4 (Aug., 2003), pp. 411-420

Abstract : Several explanations have been given for the decline in species richness with altitude. However, separating the influences of altitude, area, and isolation is difficult because of the conical shape of mountains. We used species lists of aquatic plants from > 300 lakes in a small geographical area to investigate the influence of altitude on species richness. Altitude and/or surface area were better predictors of species richness than any measure of water chemistry. The surface area and depth of individual lakes were not related to altitude, neither was the degree of isolation from other waterbodies. Although species range size increased with altitude, range sizes of all but the rarer species (in the data set) encompassed the lowest altitudes, indicating species loss rather than turnover and no influence of the Rapoport rescue effect. Nevertheless we found a decline in species richness with altitude, additive to the effect of area. Species were ascribed to attribute groups according to an a priori classification based on morphological and life-history traits. The number of attribute groups and number of species within each group increased with area, suggesting both increased diversity and coexistence within niches. With altitude, the number of attribute groups declined, but the number of species per group increased, consistent with a loss of richness and reduced competition. The species remaining at high altitudes were characterised by stress tolerant traits, associated with sites of low productivity. Our results suggest an absolute effect of altitude on species richness, irrespective of other influences and consistent with a decline in productivity.

One PDF enclosed...

Tree density decreases with increase in elevation.

Topographic and Anthropogenic Factors Shaping Subalpine Abies spectabilis Forest in Langtang National Park, Eastern Himalaya. Eurasian Journal of Forest Research. Tiwari, R.M., Shrestha, B.B. and Kohyama, T. (2017); 20 : 1-9

Abstract

Located in the Himalayas, and situated at the highest altitude worldwide, the subalpine forests have come under human pressure through means of timber logging, livestock farming and tourism, which has brought about the progress of degradation. Thus, it is essential to quantify how forest structure is determined by environmental factors over the range of subalpine zone for better management planning. We investigated the subalpine forest dominated by Abies spectabilis in Langtang National Park, Nepal Himalaya, by setting 80 plots of 10-by-10 m scattered over the range of subalpine forest from 3170 to 3810 m a.s.l. on a north-facing slope, and examined the relationship between topographic factors (e.g. altitude and slope inclination), anthropogenic factors (e.g. number of cut stumps and trampling intensity), and forest stand variables (e.g. woody species richness and composition, tree and juvenile density, basal area, and topsoil C/N content). Species richness decreased with altitude, number of fallen logs, and trampling intensity while at the same time, it increased with slope inclination and cut stump density. Stands in higher altitude showed lower tree density and basal area, while higher juvenile density of A. spectabilis. Juvenile density decreased with high basal area. Stands on steeper slopes had higher tree density with smaller maximum size on poorer soil. With increasing cut stumps, basal area and soil carbon content decreased while woody species richness and tree density increased, suggesting enhanced stand recovery in response to canopy removal. We conclude that Abies population is vulnerable to topsoil removal by trampling and cutting, and that altitude-dependent management is needed.

Altitude affects tree biodiversity inversely. High altitudes are less diverse than lower altitudes.

This is the reason , maximum plant diversity is observed unuunduunder mid-altitudes representing humid tropical/ subtropical climate..

I do agree with Dr. Anoop Kumar 's view. In tropical forests of Western Ghat Kerala, the wet evergreen forest extended up to 1000 m altitude beyond which it gradually merges to Broad leaved hill forest (Subtropical type) which is found to be less diverse when compared to Wet evergreen forests. Beyond 1700 m altitude, broad leaved hill forest merges with Montane wet temperate forest (Shola forest) which harbored very less tree diversity with maximum occurrence of herbaceous members including cryptogams.

See file: Ingegnoli Forest-Altitude

(Draft Copy)