Effects of the toxicant cadmium were studied in blowfly populations, to test whether this abiotic factor could produce indirectly positive effects on demographic rates by interacting with density-dependent processes. A previous study has demonstrated that although cadmium is toxic to blowfly individuals, cadmium exposure of whole blowfly populations nevertheless results in increased mean pupal mass and biomass production. Moreover, statistical modeling of demographic rates has indicated that cadmium-exposed populations have higher larva-to-adult survival. The aim of the present study was to test this model prediction, and to describe underlying density-dependent mechanisms. Blowflies were exposed to cadmium in both low and high densities, in two subsequent generations. In the first generation (low densities) all demographic rates were reduced by cadmium exposure, whereas in the second generation (high densities), survival of old larvae and pupae was higher in cadmium-exposed populations than in control populations. The increased survival was due to reduced larval competition, which resulted from lower reproduction and lower survival of young larvae. Hence, the indirectly positive effects of the toxicant were caused by density-dependent compensatory reactions.