Since the days of Elton, population cycles have challenged ecologists and resource managers. Although the underlying mechanisms remain debated, theory holds that both density-dependent and density-independent processes shape the dynamics. One striking example is the large-scale fluctuations of sardine and anchovy observed across the major upwelling areas of the world. Despite a long history of research, the causes of these fluctuations remain unresolved and heavily debated, with significant implications for fisheries management. We here model the underlying causes of these fluctuations, using the California Current Ecosystem as a case study, and show that the dynamics, accurately reproduced since A.D. 1661 onward, are explained by interacting density-dependent processes (i.e., through species-specific life-history traits) and climate forcing. Furthermore, we demonstrate how fishing modifies the dynamics and show that the sardine collapse of the 1950s was largely unavoidable given poor recruitment conditions. Our approach provides unique insight into the origin of sardine-anchovy fluctuations and a knowledge base for sustainable fisheries management in the California Current Ecosystem and beyond.