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A survey of 85 species of Lepidoptera feeding on 40 hosts on Barro Colorado Island, Panama showed that growth and defensive traits of caterpillars were correlated with the nutritional and defensive traits of their hosts. Growth rates were faster on young than mature leaves, reflecting the higher nitrogen and water content of the former. Growth was also positively correlated with leaf expansion rate, partially because of higher nitrogen and water contents of fast-expanding young leaves. Specialists grew faster than generalists, but both responded positively to nutritional quality. There was no effect of lepidopteran family on growth. In analyses where the effects of nitrogen and water were removed, the residuals for growth rate were greater for young than for mature leaves and were positively correlated with expansion rates of young leaves. This suggests that traits other than nutrition were also important. As young, expanding leaves cannot use toughness as a defense, one possible explanation for the differences in growth is differences in chemical defenses. Growth rate residuals for both specialists and generalists were higher for the more poorly defended fast-expanders, but the effect was greatest for generalists, perhaps because generalists were more sensitive to secondary metabolites. We predicted that slow growth for caterpillars would increase their risk to natural enemies and would select for higher defenses. Generalists had more defensive traits than specialists and were less preferred in feeding trials with ants. Similarly, species feeding on mature leaves were the most defended and those feeding on fast-expanding young leaves were the least defended and most preferred by ants. Thus the effects of plant secondary metabolites and nutrients dictate herbivore growth rates, which in turn influence their susceptibility to the third trophic level and the importance of defenses.