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Spatial dynamic theories such as source-sink models frequently describe habitat-specific demographies, yet there are surprisingly few field studies that have examined how and why interacting species vary in their dynamics across multiple habitat types. We studied the spatial pattern of interaction between a chewing herbivore and its primary larval host plant in two habitat types. We found that the interaction between an arctiid caterpillar (Platyprepia virginalis) and its host (Lupinus arboreus) differed in wet vs. upland dry habitats, as did yearly population dynamics for the caterpillar. In upland sites, there was a strong positive relationship between lupine cover and the abundance of caterpillars although this relationship was not apparent in wet sites. Additionally, in wet sites, caterpillar populations were larger and less variable across years. Caterpillars appeared to exhibit source-sink dynamics, with the time-averaged finite growth rate λ > 1 in wet sites (sources), λ <1 in upland dry sites (sinks), and predominant source-to-sink movement of late-instar caterpillars. Populations in upland dry sites also went locally extinct in years of low regional abundance. Emigration from wet sites could potentially explain the lack of coupling of herbivore and host plant dynamics in these sites. These results indicate that movement and other factors affecting demography are habitat-specific and have important implications for trophic control. Acknowledging such complexity makes simple models of trophic control seem overly general but may allow us to formulate more broadly applicable ecological models. [ABSTRACT FROM AUTHOR]