Trends in global and local climate history have been linked to observed macroevolutionary patterns across a variety of organisms. These climatic pressures may unilaterally or asymmetrically influence the evolutionary trajectory of clades. To test and compare signatures of changing global (Eocene‐Oligocene boundary cooling) and continental (Miocene aridification) environments on a continental fauna, we investigated the macroevolutionary dynamics of one of Australia's most diverse endemic radiations, pygopodoid geckos. We generated a time‐calibrated phylogeny (>90% taxon coverage) to test whether (i) asymmetrical pygopodoid tree shape may be the result of mass turnover deep in the group's history, and (ii) how Miocene aridification shaped trends in biome assemblages. We find evidence of mass turnover in pygopodoids following the isolation of the Australian continental plate ∼30 million years ago, and in contrast, gradual aridification is linked to elevated speciation rates in the young arid zone. Surprisingly, our results suggest that invasion of arid habitats was not an evolutionary end point. Instead, arid Australia has acted as a source for diversity, with repeated outward dispersals having facilitated diversification of this group. This pattern contrasts trends in richness and distribution of other Australian vertebrates, illustrating the profound effects historical biome changes have on macroevolutionary patterns.