The drivers of long-term (supra-centennial) dynamics in Southern Hemisphere aquatic ecosystem dynamics are poorly understood, particularly in relation to the influence of climatic change. Direct influences of climate on aquatic systems include temperature change and lake level fluctuations, but what of the response of aquatic systems to changes in the surrounding terrestrial environment? Long term drivers of landscape dynamics, such as vegetation change and soil/catchment dynamics, are often overlooked when considering long-term aquatic ecosystem dynamics, and ecosystem response to climate is typically the main focus. To fully understand how aquatic ecosystems are affected by climate we need a better understanding of the complex processes driving their dynamics through time, including both the direct (eg. climate) and indirect (eg. terrestrial vegetation shifts) pathways that cause change. Our aim is to better understand the pathway(s) in which climate influences aquatic ecosystem change. We present a Holocene multi-proxy palaeolimnological record from Paddy’s Lake, northwest Tasmania, Australia, that comprises pollen, organic and inorganic geochemistry, charcoal and cladocera as a means of understanding the relationship between terrestrial and aquatic ecosystem processes and climate. The cladocera record is the first record of its kind in Tasmania. Our data demonstrates (1) that vegetation and fire activity surrounding Paddy’s Lake closely track climatic variability, principally the El Niño Southern Oscillation; and (2) that changes in aquatic ecosystem dynamics (cladocera) are driven both directly and indirectly by climatic change during the Holocene.