Monoculture oil palm plantations expansion has led to biodiversity loss in tropical countries. Alley-cropping systems, which involve secondary crops between oil palms, may minimize the impacts through enhancing habitat complexity. Butterflies are reliable bioindicators and can be used to assess the impact of alley-cropping on their diversity. We compared butterfly assemblages (i.e., abundance, species richness and composition) between alley-cropping and monoculture oil palm treatments and examined microenvironmental factors (i.e., presence/absence of alley-cropping, undergrowth coverage, light intensity, air temperature and relative humidity) responsible for the difference. We sampled butterflies using line transect in seven treatments: oil palm alley-cropping systems with bamboo, black pepper, cacao, long jack and pineapple; and two oil palm monoculture systems aged seven (OP7) and fifteen years (OP15). Overall, we sampled 984 butterflies belonging to 54 species. Alley-cropping treatments had higher abundance and species density  than OP7, but not OP15.  However, rarefied species richness largely overlapped between alley-cropping and monoculture treatments, although there was a significant difference in species composition between them. Among the microenvironments, only the presence of alley-cropping had a significant positive effect on butterfly abundance and species. Thus, alley-cropping system could enhance butterfly abundance and species density with different species composition from monoculture treatments.