In the conservation literature on land-use change, it is often assumed that land-use intensification drives species loss, driving a loss of functional trait diversity and ecosystem function. Modern research, however, does not support this cascade of loss for all natural systems. In this paper we explore the errors in this assumption and present a conceptual model taking a more mechanistic approach to the species–functional trait association in a context of land-use change. We provide empirical support for our model's predictions demonstrating that the association of species and functional trait diversity follows various trajectories in response to land-use change. The central premise of our model is that land-use change impacts upon processes of community assembly, not species per se. From the model, it is clear that community context (i.e. type of disturbance, species pool size) will affect the response trajectory of the relationship between species and functional trait diversity in communities undergoing land-use change. The maintenance of ecosystem function and of species diversity in the face of increasing land-use change are complementary goals. The use of a more ecologically realistic model of responses of species and functional traits will improve our ability to make wise management decisions to achieve both aims in specific at-risk systems.