Summary1. In the absence of fish predation, Daphnia exploiting a deep‐water algal maximum are faced with a trade‐off. They can either dwell in the epilimnion where development in the warm water is fast, but food shortage causes low egg production, or in the hypolimnion, where food availability is high but development is slow because of low temperatures.2. We tested the hypotheses that (i) depth distributions of various ontogenetic stages (size classes and egg‐bearing females) differ because daphnids react to light with size‐specific diel vertical migration (DVM) even in the absence of fish (residual predator avoidance hypothesis) and (ii) differently sized daphnids select different depths because the relative importance of temperature and food varies for ontogenetic stages (physiological hypothesis). We used large indoor mesocosms (Plankton Towers) to test these hypotheses experimentally.3. Temperature was the strongest factor governing the distribution, with larger proportions of the population dwelling in the food‐rich hypolimnion if the temperature gradient was shallow. There were small but significant differences between ontogenetic stages during the day, but not at night. This suggested the existence of a ‘residual’ effect of light on depth distribution in the absence of a fish cue.4. Although large individuals exhibited greater amplitude of DVM, the physiological hypothesis had to be rejected. A stage‐specific physiological effect is unlikely to be directly triggered by light, hence vertical movement of the individuals should not be synchronised. Rather, being forced into deeper layers by the residual light response during the day, large and egg‐bearing females experience a lower average temperature during day than juveniles. They probably compensate for this by spending longer time periods in warm waters at night.