Using a 25-year time series of monthly samples, it is shown that the fish community of Bridgwater Bay in the outer Severn estuary is rapidly responding to changes in seawater temperature, salinity and the North Atlantic Oscillation (NAO). The number of fish caught each year has followed an increasing trend, which could be related to increased temperature and decreased salinity. In contrast to this smooth change, there have been two discrete transitions in fish community structure around 1986 and 1993. The first of these step changes, which altered the relative abundance of the dominant species, was linked to a change in the NAO. The second, which was caused by a change in the set of occasional visitor species, was linked to an increase in average seawater temperature. A marked increase in population variability for many fish in recent years is linked to increased seawater temperature. Generally, the position of the southern geographical limit of a species is a good indicator of their individual responses to higher temperatures. The effects of future climate change are discussed. A 2°C increase in inshore seawater temperature is predicted to increase total species richness of fish in Bridgwater Bay by 10%, although most of this gain will be warm water tourists. Predicting future communities requires consideration of combined changes in temperature, the NAOI and salinity. While the system can change to a warmer water community, there is likely to be increased short-term community instability during periods with unfavourable combinations of the key environmental variables. Such a destabilization was observed in 2002 when the abundance of many species suddenly increased then declined. A different combination of NAO, high temperature and salinity may, in the future, produce a considerable less favourable combination resulting in recruitment collapse for many species.