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Comprehending ecological dynamics requires not only knowledge of modern communities but also detailed reconstructions of ecosystem history. Ancient DNA (aDNA) metabarcoding allows biodiversity responses to major climatic change to be explored at different spatial and temporal scales. We extracted aDNA preserved in fossil rodent middens to reconstruct late Quaternary vegetation dynamics in the hyperarid Atacama Desert. By comparing our paleo‐informed millennial record with contemporary observations of interannual variations in diversity, we show local plant communities behave differentially at different timescales. In the interannual (years to decades) time frame, only annual herbaceous expand and contract their distributional ranges (emerging from persistent seed banks) in response to precipitation, whereas perennials distribution appears to be extraordinarily resilient. In contrast, at longer timescales (thousands of years) many perennial species were displaced up to 1,000 m downslope during pluvial events. Given ongoing and future natural and anthropogenically induced climate change, our results not only provide baselines for vegetation in the Atacama Desert, but also help to inform how these and other high mountain plant communities may respond to fluctuations of climate in the future. [ABSTRACT FROM AUTHOR]