We tested the proposition that there are more species in the tropics because basal clades adapted to warm paleoclimates have been lost in regions now experiencing cool climates. Molecular phylogenies were used to classify species as "basal" and "derived" based on their family, and their richness patterns were contrasted. Path models also evaluated environmental predictors of richness patterns. As predicted, basal clades are more diverse in the lowland tropics, whereas derived clades are more diverse in the extratropics and high‐altitude tropics. Seventy‐four percent of the variation in bird richness was explained by environmental variables, but models differed for basal and derived groups. The overall gradient is described by the spatial pattern of basal clades, although there are differences in the Old and New Worlds. We conclude that in ecological time, the global richness gradient reflects birds' responses to climatic gradients, partially operating via plants. Over evolutionary time, the gradient primarily reflects the extirpation of species in older clades from parts of the world that have become cooler in the present. A strong secondary effect arises from dispersal of clades from centers of origin and subsequent radiations. Overall, the diversity gradient is well explained by niche conservatism and the "time‐for‐speciation" hypothesis.