Removal of large predatory fishes from marine ecosystems has resulted in persistent ecosystem shifts, with collapsed predator populations and super-abundant prey populations. One explanation for these shifts is reversals of predator-prey roles that generate internal feedbacks in the ecosystems. Pelagic forage fish are often predators and competitors to the young life stages of their larger fish predators. I show that cod recruitment in the North Sea has been negatively related to the spawning-stock biomass of herring for the last 44 years. Herring, together with the abundance of Calanus finmarchicus, the major food for cod larvae, were the main predictors of cod recruitment. These predictors were of equivalent importance, worked additively, and explained different parts of the dynamics in cod recruitment. I suggest that intensive harvesting of cod has released herring from predator control, and that a large population of herring suppresses cod recruitment through predation on eggs and larvae. This feedback mechanism can promote alternative stable states and therefore cause hysteresis to occur under changing conditions; however, harvesting of herring might at present prevent a shift in the ecosystem to a herring-dominated state.