I investigated the population dynamics and competitive interactions of two species of the suspension-feeding crustacean Daphnia in Oneida Lake, N.Y. Both species have persisted in the lake for decades, but their water-column densities are negatively correlated. The larger Daphnia pulicaria dominates in some years, the smaller D. galeata mendotae in others, and in some years one species replaces the other seasonally. Although this pattern results in part from annual variation in vertebrate predation pressure, predation alone cannot explain the irregular daphnid dynamics. In 1992-1995, I examined the water-column abundances, birth and death rates of both species. D. pulicaria dominated in two years, D. galeata mendotae was replaced by D. pulicaria in one year and in 1994, both species persisted in low numbers. To test the effect of temporal changes on the strength of intra- and interspecific competition on both juvenile and adult daphnids, I manipulated a series of field enclosures in 1994 and 1995. The outcome of competition varied within and between years, and its effects were most evident at the highest densities and lowest resource levels. For adults of both species, the effects of interspecific competition were detected more often than those of intraspecific competition. Lipid reserves (a metric of fitness) among juveniles were generally low, with those of D. galeata mendotae often being less than those of D. pulicaria. Contrary to the results of other studies examining competition in daphnids, spatial segregation and predictable within-year reversals in competitive dominance most likely do not play a large role in fostering coexistence of the Oneida Lake daphnids. Instead, coexistence of these competitors is promoted by interannual variation and long-lived diapausing eggs.