Savannas are a major terrestrial biome, comprising of grasses with the C4 photosynthetic pathway and trees with the C3 type. This mixed grass–tree biome rapidly appeared on the ecological stage 8 million years ago with the near-synchronous expansion of C4 grasses around the world. We propose a new hypothesis for this global event based on a systems analysis that integrates recent advances in how fire influences cloud microphysics, climate and savanna ecology in a low carbon dioxide (CO2) world. We show that fire accelerates forest loss and C4 grassland expansion through multiple positive feedback loops that each promote drought and more fire. A low CO2 atmosphere amplifies this cycle by limiting tree recruitment, allowing the ingress of C4 grasses to greatly increase ecosystem flammability. Continued intensification of land use could enhance or moderate the network of feedbacks that have initiated, promoted and sustained savannas for millions of years. We suggest these alterations will overprint the effects of anthropogenic atmospheric change in coming decades.