Seasonal upwelling at the northern Pacific coast of Costa Rica offers the opportunity to investigate the effects of pronounced changes in key water parameters on fine-scale dynamics of local coral reef communities. This study monitored benthic community composition at Matapalo reef (10.539°N, 85.766°W) by weekly observations of permanent benthic quadrats from April 2013 to April 2014. Monitoring was accompanied by surveys of herbivore abundance and biomass and measurements of water temperature and inorganic nutrient concentrations. Findings revealed that the reef-building corals Pocillopora spp. exhibited an exceptional rapid increase from 22 to 51% relative benthic cover. By contrast, turf algae cover decreased from 63 to 24%, resulting in a corresponding increase in crustose coralline algae cover. The macroalga Caulerpa sertularioides covered up to 15% of the reef in April 2013, disappeared after synchronized gamete release in May, and subsequently exhibited slow regrowth. Parallel monitoring of influencing factors suggest that C. sertularioides cover was mainly regulated by their reproductive cycle, while that of turf algae was likely controlled by high abundances of herbivores. Upwelling events in February and March 2014 decreased mean daily seawater temperatures by up to 7 °C and increased nutrient concentrations up to 5- (phosphate) and 16-fold (nitrate) compared to mean values during the rest of the year. Changes in benthic community composition did not appear to correspond to the strong environmental changes, but rather shifted from turf algae to hard coral dominance over the entire year of observation. The exceptional high dynamic over the annual observation period encourages further research on the adaptation potential of coral reefs to environmental variability.