The concept that diversity promotes reliability of ecosystem function depends on the pattern that community-level biomass shows lower temporal variability than species-level biomasses. However, this pattern is not universal, as it relies on compensatory or independent species dynamics. When in contrast within-trophic level synchronization occurs, variability of community biomass will approach population-level variability. Current knowledge fails to integrate how species richness, functional distance between species, and the relative importance of predation and competition combine to drive synchronization at different trophic levels. Here we clarify these mechanisms. Intense competition promotes compensatory dynamics in prey, but predators may at the same time increasingly synchronize, under increasing species richness and functional similarity. In contrast, predators and prey both show perfect synchronization under strong top-down control, which is promoted by a combination of low functional distance and high net growth potential of predators. Under such conditions, community-level biomass variability peaks, with major negative consequences for reliability of ecosystem function.