Episodes of mass extinction represent the largest events of biodiversity loss known in the geologic record, and may provide tests of biodiversity-ecosystem stability hypotheses. Here we present the first correlation between ammonoid diversity and disparity and ecosystem stability as represented by stable carbon isotopic records spanning the end-Permian through end-Triassic mass extinctions. Ammonoid generic richness from a single biogeographic realm shows that nearly all taxa disappeared coincident with major carbon isotopic shifts to lighter values. The intervals following these two major mass extinctions were characterized by multiple positive-negative couplets of chaotic carbon cycling and were composed of low-richness ammonoid faunas characterized by higher proportions of passively floating, non-swimming morphotypes than before or after. In contrast, richness was highest during intervals of stable carbon isotope values. We propose that these “chaotic carbon episodes” reflect the breakdown of functional redundancy in the ecosystem, and that the post-extinction carbon cycle did not stabilize until redundancy was restored.