Biodiversity and food chain length each can strongly influence ecosystem functioning, yet their interactions rarely have been tested. We manipulated grazer diversity in seagrass mesocosms with and without a generalist predator and monitored community development. Changing food chain length altered biodiversity effects: higher grazer diversity enhanced secondary production, epiphyte grazing, and seagrass biomass only with predators present. Conversely, changing diversity altered top-down control: predator impacts on grazer and seagrass biomass were weaker in mixed-grazer assemblages. These interactions resulted in part from among-species trade-offs between predation resistance and competitive ability. Despite weak impact on grazer abundance at high diversity, predators nevertheless enhanced algal biomass through a behaviourally mediated trophic cascade. Moreover, predators influenced every measured variable except total plant biomass, suggesting that the latter is an insensitive metric of ecosystem functioning. Thus, biodiversity and trophic structure interactively influence ecosystem functioning, and neither factor's impact is predictable in isolation.