This paper details the theory of edge shear layer collapse as the density approaches the Greenwald density limit. It significantly extends earlier work, which was restricted in applicability. The zonal shear flow screening length is calculated for banana, plateau and Pfirsch–Schluter regimes. Poloidal field scaling persists in the plateau regime. Neoclassical screening and drift wave–zonal flow dynamics are combined in a theory, which is then reduced to a predator–prey model. Zonal noise, due to incoherent mode coupling, is retained. The threshold condition for edge shear layer collapse is computed, and linked to a critical value of the dimensionless parameter . Here is the ion sound radius, is the zonal flow screening length and is the equilibrium density scale length. The limiting initial edge density for shear layer collapse is derived and shown to scale favorably with the plasma current. The results are discussed in light of the density limit and Ohmic phenomenology.