Abstract Soil faunal activity can be a major control of greenhouse gas (GHG) emissions from soil. Effects of single faunal species, genera or families have been investigated, but it is unknown how soil fauna diversity may influence emissions of both carbon dioxide (CO2, end product of decomposition of organic matter) and nitrous oxide (N2O, an intermediate product of N transformation processes, in particular denitrification). Here, we studied how CO2 and N2O emissions are affected by species and species mixtures of up to eight species of detritivorous/fungivorous soil fauna from four different taxonomic groups (earthworms, potworms, mites, springtails) using a microcosm set-up. We found that higher species richness and increased functional dissimilarity of species mixtures led to increased faunal-induced CO2 emission (up to 10%), but decreased N2O emission (up to 62%). Large ecosystem engineers such as earthworms were key drivers of both CO2 and N2O emissions. Interestingly, increased biodiversity of other soil fauna in the presence of earthworms decreased faunal-induced N2O emission despite enhanced C cycling. We conclude that higher soil fauna functional diversity enhanced the intensity of belowground processes, leading to more complete litter decomposition and increased CO2 emission, but concurrently also resulting in more complete denitrification and reduced N2O emission. Our results suggest that increased soil fauna species diversity has the potential to mitigate emissions of N2O from soil ecosystems. Given the loss of soil biodiversity in managed soils, our findings call for adoption of management practices that enhance soil biodiversity and stimulate a functionally diverse faunal community to reduce N2O emissions from managed soils.