Large areas of cold hypoxic water occur as distinct strata in the eastern tropical Pacific (ETP) and Atlantic oceans as a result of high productivity initiated by intense nutrient upwelling. We show that this stratum restricts the depth distribution of tropical pelagic marlins, sailfish, and tunas by compressing the acceptable physical habitat into a narrow surface layer. This layer extends downward to a variable boundary defined by a shallow thermocline, often at 25 m, above a barrier of cold hypoxic water. The depth distributions of marlin and sailfish monitored with electronic tags and average dissolved oxygen (DO) and temperature profiles show that this cold hypoxic environment constitutes a lower habitat boundary in the ETP, but not in the western North Atlantic (WNA), where DO is not limiting. Eastern Pacific and eastern Atlantic sailfish are larger than those in WNA, where the hypoxic zone is much deeper or absent. Larger sizes may reflect enhanced foraging opportunities afforded by the closer proximity of predator and prey in compressed habitat, as well as by the higher productivity. The shallow band of acceptable habitat restricts these fishes to a very narrow surface layer and makes them more vulnerable to over-exploitation by surface gears. Predictably, the long-term landings of tropical pelagic tunas from areas of habitat compression have been far greater than in surrounding areas. Many tropical pelagic species in the Atlantic Ocean are currently either fully exploited or overfished and their future status could be quite sensitive to increased fishing pressures, particularly in areas of habitat compression.