The Devonian marks a critical stage in the early evolution of vertebrates: It opens with an unprecedented diversity of fishes and closes with the earliest evidence of limbed tetrapods. However, the latter part of the Devonian has also been characterized as a period of global biotic crisis marked by two large extinction pulses: a "Big Five" mass extinction event at the Frasnian-Famennian stage boundary (374 Ma) and the less well-documented Hangenberg event some 15 million years later at the Devonian-Carboniferous boundary (359 Ma). Here, we report the results of a wide-ranging analysis of the impact of these events on early vertebrate evolution, which was obtained from a database of vertebrate occurrences sampling over 1,250 taxa from 66 localities spanning Givetian to Serpukhovian stages (391 to 318 Ma). We show that major vertebrate clades suffered acute and systematic effects centered on the Hangenberg extinction involving long-term losses of over 50% of diversity and the restructuring of vertebrate ecosystems worldwide. Marine and nonmarine faunas were equally affected, precluding the existence of environmental refugia. The subsequent recovery of previously diverse groups (including placoderms, sarcopterygian fish, and acanthodians) was minimal. Tetrapods, actinopterygians, and chondrichthyans, all scarce within the Devonian, undergo large diversification events in the aftermath of the extinction, dominating all subsequent faunas. The Hangenberg event represents a previously unrecognized bottleneck in the evolutionary history of vertebrates as a whole and a historical contingency that shaped the roots of modern biodiversity.