A classic question in evolutionary biology concerns the tempo and mode of lineage evolution. Considered variously in relation to resource utilization, intrinsic constraints or hierarchic level, the question of how evolutionary change occurs in general has continued to draw the attention of the field for over a century and a half. Here we use the largest species-level phylogeny of Coenozoic fossil mammals (1031 species) ever assembled and their body size estimates, to show that body size and taxonomic diversification rates declined from the origin of placentals towards the present, and very probably correlate to each other. These findings suggest that morphological and taxic diversifications of mammals occurred hierarchically, with major shifts in body size coinciding with the birth of large clades, followed by taxonomic diversification within these newly formed clades. As the clades expanded, rates of taxonomic diversification proceeded independently of phenotypic evolution. Such a dynamic is consistent with the idea, central to the Modern Synthesis, that mammals radiated adaptively, with the filling of adaptive zones following the radiation.