In China, and elsewhere, long-term economic development and poverty alleviation need to be balanced against the likelihood of ecological failure. Here, we show how paleoenvironmental records can provide important multidecadal perspectives on ecosystem services (ES). More than 50 different paleoenvironmental proxy records can be mapped to a wide range of ES categories and subcategories. Lake sediments are particularly suitable for reconstructing records of regulating services, such as soil stability, sediment regulation, and water purification, which are often less well monitored. We demonstrate the approach using proxy records from two sets of lake sediment sequences in the lower Yangtze basin covering the period 1800–2006, combined with recent socioeconomic and climate records. We aggregate the proxy records into a regional regulating services index to show that rapid economic growth and population increases since the 1950s are strongly coupled to environmental degradation. Agricultural intensification from the 1980s onward has been the main driver for reducing rural poverty but has led to an accelerated loss of regulating services.