Island biotas have disproportionately influenced the history and development of evolutionary biology, but understanding their genesis and evolution across geological timescales has been hindered by a poor fossil record. Here we augment the insular Eocene (~43 Ma) mammalian fauna known from the Pontide terrane of central Anatolia by describing two new metatherian taxa (stem marsupials) from the Lülük Member of the Uzunçarşıdere Formation in the Orhaniye Basin. Geological and paleontological data indicate that the Pontide terrane was an island on the northern margin of Neotethys during the middle Eocene. Reflecting its geodynamic context in a region of active tectonic convergence, the Eocene Pontide terrane hosted a unique combination of Laurasian and Gondwanan mammals, including an anachronistic radiation of pleuraspidotheriids (archaic ungulates) that went extinct on the European mainland ~13 Ma earlier. Most of the mammalian clades occupying the Pontide terrane colonized it by dispersal across marine barriers rather than being stranded there through vicariance. Endemic radiations of pleuraspidotheriid ungulates and polydolopimorphian metatherians on the Pontide terrane reveal that in situ diversification was an important factor contributing to faunal assembly and evolution. The insular fauna that arose on the Pontide terrane is highly analogous to that of modern Sulawesi, which evolved under strikingly similar geological conditions. Illustrating the ephemeral nature of insular biotas across macroevolutionary timescales, the demise of the Pontide fauna coincided with paleogeographic changes enabling more cosmopolitan taxa to reach it for the first time. The high level of endemism shown by the mammalian fauna of the Uzunçarşıdere Formation eliminates the Pontide terrane as a potential early Eocene dispersal corridor between western Europe and India.