Phenotypic evolution is often exceptionally rapid on islands, resulting in numerous, ecologically diverse species. Although adaptive radiation proceeds along various phenotypic axes, the island effect of faster evolution has been mostly tested with regard to morphology. Here, we leveraged the physiological diversity and species richness of Anolis lizards to examine the evolutionary dynamics of three key traits: heat tolerance, body temperature, and cold tolerance. Contrary to expectation, we discovered slower heat tolerance evolution on islands. Additionally, island species evolve toward higher optimal body temperatures than mainland species. Higher optima and slower evolution in upper physiological limits are consistent with the Bogert effect, or evolutionary inertia due to thermoregulation. Correspondingly, body temperature is higher and more stable on islands than on the American mainland, despite similarity in thermal environments. Greater thermoregulation on islands may occur due to ecological release from competitors and predators compared to mainland environments. By reducing the costs of thermoregulation, ecological opportunity on islands may actually stymie, rather than hasten, physiological evolution. Our results emphasize that physiological diversity is an important axis of ecological differentiation in the adaptive radiation of anoles, and that behavior can impart distinct macroevolutionary footprints on physiological diversity on islands and continents.