The Holocene (0-11.7 ka BP) appears warm and stable in ice core and global temperature reconstructions as well as in transient climate simulations. This seeming quiescence of Earth's climate belies large secular changes in seasonal and zonal mean radiation receipts resulting from variations in orbital precession and obliquity. Here we show that the tropical Pacific, a key mediator of global climate, underwent a profound climatic shift during the Holocene. Hydrogen isotope ratios of the algal lipid dinosterol, isolated from marine lake sediments in Palau, increased by 50‰ between 7.7 and 4.5 ka BP, indicating a reduction in precipitation. This implied drying coincided with increased rainfall to the southwest of Palau in Borneo, weakened northern hemisphere monsoons, strengthened southern hemisphere monsoons, and an equatorward shift of terrestrial photosynthesis. A southward shift of the Intertropical Convergence Zone, forced by insolation, is the most likely cause of these climatic and biospheric changes.