In the past, explanations for high species diversity have been sought at the species level. Theory shows that coexistence requires substantial differences between species, but species-level data rarely provide evidence for such differences. Using data from forests in the southeastern United States, I show here that variation evident at the individual level provides for coexistence of large numbers of competitors. Variation among individuals within populations allows species to differ in their distributions of responses to the environment, despite the fact that the populations to which they belong do not differ, on average. Results are consistent with theory predicting that coexistence depends on competition being stronger within than between species, shown here by analysis of individual-level responses to environmental fluctuation.