Growth rate increases with latitude in the Atlantic silverside, Menidia menidia, and the population differences have a genetic basis. Understanding the evolution of this latitudinal gradient in somatic growth required knowledge of the physiological basis of the growth-rate variation. In theory, the faster growth of northern fish must be achieved by higher consumption rates and/or higher somatic growth efficiencies. If, as is frequently assumed, physiological efficiencies are often maximized by natural selection, the faster growth of higher-latitude silversides should result solely from higher consumption rates. We compared the consumption rates and gross growth efficiencies of fish from laboratory-reared stocks that were originated with fish from Nova Scotia (NS) and South Carolina (SC). Experiments were conducted on young, immature fish at a variety of excess ration levels under conditions of controlled fish density at low (17-degrees-C) and high (28-degrees-C) experimental temperatures. NS fish consumed more food (1.7 times) than SC fish and also had significantly higher (1.8-2.2 times) growth efficiencies. Genetic variation in both consumption rate and growth efficiency is therefore responsible for the interpopulation variation in growth rate. This suggests that costs and trade-offs associated with both high consumption rates and high growth efficiency may be the reason why low-latitude populations have submaximal growth rates. The assumption that growth efficiencies are generally at the maxiumum level that a species is physiologically and genetically capable of achieving should be viewed with caution.