The four-year cycle of microtine rodents in boreal and arctic regions was first described in 1924 (ref. 1). Competing hypotheses on the mechanisms underlying the small mammal cycle have been extensively tested, but so far the sustained rodent oscillations are unexplained. Here we use two mutually supportive approaches to investigate this question. First, building on studies of the interaction between rodents and their mustelid predators, we construct a predator-prey model with seasonality. Second, we use a new technique of nonlinear analysis to examine empirical time-series data, and compare them with the model dynamics. The model parameterized with field data predicts dynamics that closely resemble the observed dynamics of boreal rodent populations. Both the predicted and observed dynamics are chaotic, albeit with a statistically significant periodic component. Our results suggest that the multiannual oscillations of rodent populations in Fennoscandia are due to delayed density dependence imposed by mustelid predators, and are chaotic.