Online enhancements: appendix, supplement.abstract: Dioecy has a demographic disadvantage compared with hermaphroditism: only about half of reproductive adults produce seeds. Dioecious species must therefore have fitness advantages to compensate for this cost through increased survival, growth, and/or reproduction. We used a full life cycle approach to quantify the demographic costs and benefits associated with dioecy while controlling for demographic differences between dioecious and hermaphroditic species related to other functional traits. The advantage of this novel approach is that we can focus on the effect of breeding system across a diverse tree community. We built a composite integral projection model for hermaphroditic and dioecious tree populations from Barro Colorado Island, Panama, using long-term demographic and newly collected reproductive data. Integration of all costs and benefits showed that compensation was realized through increased seed production, resulting in no net costs of dioecy. Compensation was also facilitated by the low contribution of reproduction to population growth. Estimated positive effects of dioecy on tree growth and survival were small and insignificant for population growth rates. Our model revealed that, for long-lived organisms, the cost of having males is smaller than generally expected. Hence, little compensation is required for dioecious species to maintain population growth rates similar to those of hermaphroditic species.