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Tropical dry islands are currently facing major challenges derived from anthropogenic and climatic pressures. However, their trajectories of environmental change, which could provide relevant information applicable to biodiversity conservation, remain understudied. This is mainly due to poor micro-fossil preservation and irregular sediment deposition. Multi-proxy palaeoecological analyses spanning decades to 1000s of years can add perspective as to how vegetation, fungal communities, and the fauna responded to previous natural and anthropogenic disturbances. In Sao Nicolau, Cabo Verde, we used palaeoecological methods to analyse a highland soil profile (1000 m asl) dated to 5900 cal yr BP. We analysed how vegetation (abundances in pollen of native and introduced species, and leaf wax n-alkanes), ferns and fungal communities (abundance of non-pollen palynomorphs) varied over time in relation to fire (charcoal concentration) and erosion regimes (grain sizes and elemental composition). Between 5000 and 400 cal yr BP the highlands held native woody taxa such as Euphorbia tuckeyana, Dracaena draco subsp. caboverdeana, and Ficus, taxa that can be used for future reforestation programmes. From 400 cal yr BP to the present day, replacement of native taxa by introduced and cultivated taxa (Pinus, Eucalyptus, Asystasia, Opuntia) has occurred. Vegetation burning and grazing caused loss of vegetation and erosion, acting as conjoined drivers of scrubland degradation. This dataset helps to set historically contextualised restoration goals such as the re-introduction of native species, monitoring of recently introduced species and control of free grazing. This can serve as a model system for the conservation of tropical dry islands' biodiversity.