Common garden folklore has it that coffee grounds are a good fertilizer, especially for acid-loving plants, because of the acid in the coffee. However, coffee grounds contain many different chemicals, including caffeine, which is toxic to many organisms in large amounts. Last fall I decided to do a test, planting three identically sized pots with the same potting soil and 25 seeds each of "Champion" radishes.
One pot had potting soil only, another had a layer of coffee grounds spread on top after the seeds were sown, and another had coffee grounds mixed into all of the soil. The pots were watered as necessary and thinned to the best 10 seedlings when they started to get crowded. After six weeks, some of the radishes had reached edible size, and they were all harvested, so that root development in each pot could be compared.
As you can see in the photos below, all of the pots showed good germination, but the seedlings in the pot with coffee grounds mixed into the soil soon lagged behind in development and struggled to produce true leaves, even as the plants in the other two pots were thriving. They ended up being severely stunted, and by harvest time they hadn't even come close to producing roots of an edible size.
The results of this little experiment suggest that spreading coffee grounds on top of the soil may be harmless, but mixing coffee into the soil as a fertilizer may be a really bad idea. Further tests will be conducted next year with other garden crops to see whether the same results are obtained.