Modern beavers (Castor) are prolific ecosystem engineers and dramatically alter the landscape through tree harvesting and dam building. Little is known, however, about the evolutionary drivers of their woodcutting behaviour. Here we investigate if early woodcutting behaviour in Castoridae was driven by nutritional needs. We measured stable carbon and nitrogen isotopes (δ13C and δ15N) of coeval subfossil plants and beaver collagen (Dipoides sp.) from the Early Pliocene, High Arctic Beaver Pond fossil locality (Ellesmere Island), in order to reconstruct Dipoides sp. diet. Isotopic evidence indicates a diet of woody plants and freshwater macrophytes, supporting the hypothesis that this extinct semiaquatic beaver engaged in woodcutting behaviour for feeding purposes. In a phylogenetic context, the isotopic evidence implies that woodcutting and consumption of woody plants can be traced back to a small-bodied, semiaquatic Miocene castorid, suggesting that beavers have been consuming woody plants for over 20 million years. We propose that the behavioural complex (swimming, woodcutting, and consuming woody plants) preceded and facilitated the evolution of dam building. Dam building and food caching behaviours appear to be specializations for cold winter survival and may have evolved in response to late Neogene northern cooling.