The end-Guadalupian extinction, at the end of the Middle Permian, is thought to have been one of the largest biotic crises in the Phanerozoic. Previous estimates suggest that the crisis eliminated 58% of marine invertebrate genera during the Capitanian stage and that its selectivity helped the Modern evolutionary fauna become more diverse than the Paleozoic fauna before the end-Permian mass extinction. However, a new sampling-standardized analysis of Permian diversity trends, based on 53731 marine invertebrate fossil occurrences from 9790 collections, indicates that the end-Guadalupian “extinction” was actually a prolonged but gradual decrease in diversity from the Wordian to the end of the Permian. There was no peak in extinction rates; reduced genus richness exhibited by all studied invertebrate groups and ecological guilds, and in different latitudinal belts, was instead driven by a sharp decrease in origination rates during the Capitanian and Wuchiapingian. The global diversity decrease was exacerbated by changes in beta diversity, most notably a reduction in provinciality due to the loss of marine habitat area and a pronounced decrease in geographic disparity over small distances. Disparity over moderate to large distances was unchanged, suggesting that small-scale beta diversity changes may have resulted from compression of bathymetric ranges and homogenization of onshore-offshore faunal gradients stemming from the spread of deep-water anoxia around the Guadalupian/Lopingian boundary. Although tropical invertebrate genera were no more likely than extratropical ones to become extinct, the marked reduction in origination rates during the Capitanian and Wuchiapingian is consistent with the effects of global cooling (the Kamura Event), but may also be consistent with other environmental stresses such as anoxia. However, a gradual reduction in diversity, rather than a sharp end-Guadalupian extinction, precludes the need to invoke drastic extinction mechanisms and indicates that taxonomic loss at the end of the Paleozoic was concentrated in the traditional end-Permian (end-Changhsingian) extinction, which eliminated 78% of all marine invertebrate genera.