Advances in sequencing technologies have enabled novel insights into microbial niche differentiation, from analyzing environmental samples to understanding human diseases and informing dietary studies. However, identifying the microbial taxa that differentiate these samples can be challenging. These issues stem from the compositional nature of 16S rRNA gene data (or, more generally, taxon or functional gene data); the changes in the relative abundance of one taxon influence the apparent abundances of the others. Here we acknowledge that inferring properties of individual bacteria is a difficult problem and instead introduce the concept of balances to infer meaningful properties of subcommunities, rather than properties of individual species. We show that balances can yield insights about niche differentiation across multiple microbial environments, including soil environments and lung sputum. These techniques have the potential to reshape how we carry out future ecological analyses aimed at revealing differences in relative taxonomic abundances across different samples. By explicitly accounting for the compositional nature of 16S rRNA gene data through the concept of balances, balance trees yield novel biological insights into niche differentiation. The software to perform this analysis is available under an open-source license and can be obtained at https://github.com/biocore/gneiss. : An author video summary of this article is available.