The Late Miocene brought a sudden increase in the biomass of C4 plants that resulted in an expansion of grassland habitat and markedly changed the diets of vertebrate fauna in many places around the world. Concurrently, early pulses of Great American Biotic Interchange (GABI) migrations are evidenced by early first appearances of immigrant taxa in the fossil record, leading into the major GABI pulses in the Early Pliocene. The causes and environmental context of GABI migrations, however, are not well understood. Vertebrate fossils from Yepómera, western Chihuahua, represent one of the richest assemblages in Mexico and are a valuable paleo-environmental archive. This study examined the stable isotope compositions of tooth enamel samples of this fauna to provide broad insight into the environmental conditions of this region between 4.89 to 5.23 Ma, just after the arrival of C4 plants in North and South America and before the first major migration of GABI. The enamel carbon and oxygen isotope data suggest a relatively dry, open habitat (similar to savanna or prairie environments) with a strong C4 vegetation component, a mean annual temperature of 18 ± 10°C and a moderate annual precipitation of 657 ± 93 mm/yr. At Yepómera, there was distinct niche partitioning into pure C3 diets, mixed diets, and pure C4 diets. As such, C4 vegetation must have been a major component of the environment during the Late Miocene-Early Pliocene. Despite expectations, no niche partitioning between equid species (Dinohippus mexicanus, Nannippus aztecus, Astrohippus stockii, and Neohipparion eurystyle) can be determined from carbon isotope ratios. All four fossil horse species found in Yepómera had pure or nearly pure C4 diets, suggesting that they were hyper grazers or primarily grazers, consistent with the inference from their dental morphology. Pure C3 consumption was rare to absent in all other genera analyzed except for the genus Camelops, for which C3 vegetation was the dominant diet. Samples from Hemiauchenia varied between pure C3 diet and a mixed diet depending on the individual. The other genera in this study site (Gomphotheriidae, Hexobelomeryx fricki, and Platygonus) were primarily mixed feeders. Assuming a carnivorous life habit (based on dentition), Agriotherium schneideri, an immigrant large ursid, appears to have consumed primarily equids or an unsampled taxon with predominantly C4 diet. However, the enamel isotope data cannot exclude the possibility of an omnivorous life habit. Migrations are evidenced in the oxygen isotope ratios of several specimens indicating that there was mobility in these taxa before the GABI, with diets remaining consistent throughout this migration (suggesting strong dietary preferences and niche specialization). The carbon and oxygen isotope ratios of the Yepómera fauna are consistent with both the holding pen hypothesis for the GABI and a Central American rise in C4 biomass at least close in time to the expansion of C4 biomass in North America. Through adaptation to this ecosystem, these taxa would be well prepared to exploit and compete for the grassland habitats proposed to have developed on the Panama Isthmus. This could explain how equids, peccaries, gomphotheres, and short-faced bears related to these taxa had such success in arriving and diversifying in the South American mainland, where a similar habitat is believed to have expanded around the time of the exchange. Future work in this area will lead to a more complete understanding of biologic responses to changing climate and population dynamics.