Survey data from New England showed that assemblages of Lestes damselflies are organized along the entire gradient of pond permanence and predator presence. One assemblage occupies vernal ponds lacking large dragonfly predators and fish; four are largely confined to temporary ponds that typically contain dragonfly predators; one dominates fishless permanent ponds and lakes where dragonflies are the top predators; and one dominates permanent ponds and lakes where fish are the top predators. We determined the role of life history and predation in maintaining this striking pattern by conducting a series of transplant experiments in the field and a laboratory experiment manipulating presence and absence of local predators. Life history (1) shaped the ability of species to cope with drying regime, thereby excluding temporary-pond Lestes from vernal ponds and permanent-water Lestes from temporary ponds, and (2) generated size differences among species due to differences in the timing of hatching. This mediated the exclusion of temporary-pond Lestes from permanent water bodies through asymmetric intraguild predation by permanent-water Lestes. Dragonfly predation on permanent-water Lestes had an indirect positive effect on the survival of temporary-pond Lestes; however, this effect apparently is too small to allow coexistence of both Lestes groups. Predation by large dragonfly larvae excluded the Lestes species of vernal ponds from temporary ponds, and differential vulnerability to large dragonfly larvae and fish shaped the reciprocal dominance of L. eurinus and L. vigilax in fishless and fish-containing permanent water bodies, respectively. Taken together, these results show that life history constraints and predation both shape the distributions of Lestes species along the pond permanence gradient in New England. We discuss the importance of this freshwater habitat gradient in shaping local and regional species diversity.