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The decline in species richness at higher latitudes is among the most fundamental patterns in ecology. Whether changes in species composition across space (beta-diversity) contribute to this gradient of overall species richness (gamma-diversity) remains hotly debated. Previous studies that failed to resolve the issue suffered from a well-known tendency for small samples in areas with high gamma-diversity to have inflated measures of beta-diversity. Here, we provide a novel analytical test, using beta-diversity metrics that correct the gamma-diversity and sampling biases, to compare beta-diversity and species packing across a latitudinal gradient in tree species richness of 21 large forest plots along a large environmental gradient in East Asia. We demonstrate that after accounting for topography and correcting the gamma-diversity bias, tropical forests still have higher beta-diversity than temperate analogues. This suggests that beta-diversity contributes to the latitudinal species richness gradient as a component of gamma-diversity. Moreover, both niche specialization and niche marginality (a measure of niche spacing along an environmental gradient) also increase towards the equator, after controlling for the effect of topographical heterogeneity. This supports the joint importance of tighter species packing and larger niche space in tropical forests while also demonstrating the importance of local processes in controlling beta-diversity.