Ectotherms are considered to be particularly vulnerable to climate warming. Descriptions of habitat temperatures and predicted changes in climate usually consider mean monthly, seasonal or annual conditions. Ectotherms, however, do not simply experience mean conditions, but are exposed to daily fluctuations in habitat temperatures. Here, we highlight how temperature fluctuation can generate ‘realized’ thermal reaction (fitness) norms that differ from the ‘fundamental’ norms derived under standard constant temperatures. Using a mosquito as a model organism, we find that temperature fluctuation reduces rate processes such as development under warm conditions, increases processes under cool conditions, and reduces both the optimum and the critical maximum temperature. Generalizing these effects for a range of terrestrial insects reveals that prevailing daily fluctuations in temperature should alter the sensitivity of species to climate warming by reducing ‘thermal safety margins’. Such effects of daily temperature dynamics have generally been ignored in the climate change literature.