1. One of the oldest questions in ecology is how species diversity in any given trophic level is related to the availability of essential resources that limit biomass (e.g. water, nutrients, light or prey). Researchers have tried to understand this relationship by focusing either on how diversity is influenced by the availability of resources, or alternatively, how resource abundance is influenced by species diversity. These contrasting perspectives have led to a seeming paradox '... is species diversity the cause or the consequence of resources that limit community biomass?' 2. Here we present results of an experiment that show it is possible for species diversity and resource density to exhibit reciprocal causal relationships in the same ecological system. Using a guild of ladybeetle predators and their aphid prey, we manipulated the number of predator species in field enclosures to examine how predator diversity impacts prey population size. At the same time, we manipulated the abundance of aphid prey in discrete habitat patches within each enclosure to determine how smaller-scale spatial variation in resource abundance affects the number of co-occurring predator species. 3. We found that the number of ladybeetle species added to enclosures had a significant impact on aphid population dynamics because interference competition among the predators reduced per capita rates of predation and, in turn, the overall efficiency of the predator guild. At the same time, spatial variation in aphid abundance among smaller habitat patches generated variation in the observed richness of ladybeetles because more species occurred in patches where predators aggregated in response to high aphid density. 4. The results of our experiment demonstrate that it is possible for species diversity to simultaneously be a cause and a consequence of resource density in the same ecological system, and they shed light on how this might occur for groups of mobile consumers that exhibit rapid responses to spatial and temporal variation in their prey.