We combine on‐ and off‐site research in a 9 km2 drainage in the Mexican highlands to reconstruct its settlement and land use history. We examine colluvial, alluvial, and volcanic sediments, as well as charcoal assemblages from alluvium and test pits excavated at the village of Calaveras, settled by 500 B.C. Between that date and A.D. 1000 swiddening practices stripped the drainage of its pre‐agricultural soil cover, filling streams with deposits up to 12 m thick. This transformation favored the replacement of oak by pine as the dominant species in old fields. There is no archaeological site dated to A.D. 100–1000, but continued human presence is attested by the charcoal‐rich alluvium, and isolated features, artifacts, and ecofacts in off‐site contexts. Around A.D. 1050 ash erupted from Popocatepetl volcano rejuvenated the soil cover. Slopes were terraced and occupied by dispersed farmsteads. Soon after Spanish Conquest epidemics decimated the rural population. The resulting terrace abandonment and collapse led to widespread gullying, the exposure of underlying duripans, and the formation of a ubiquitous colluvial mantle. Erosion and grazing likely favored the expansion of juniper. Agriculture was intensified and disintensified several times in the last 3000 years, but its effects are cumulative and irreversible, rather than cyclical.