Biodiversity is a key concept for conservation and management and is fundamental for ecosystem-based approaches. It is of importance to consider whole areas in which communities and their ecological processes can be maintained. To effectively manage ecosystems for sustainable use and conservation, it is important to understand changes in the ecosystems. The objective of this study was to investigate the species diversity of groundfish and invertebrates, including both commercially exploited species as well as unexploited species, and identify long-term changes in the composition and abundance of the groundfish community and the northern shrimp (Pandalus borealis) in six fjords off Iceland in the period from 1995 to 2016 using data from annual shrimp survey. The results showed a strong indication of species replacement during the study period and a top-down control, where the abundance of cod and haddock increased at the same time as the abundance of northern shrimp, eelpouts, blennies and flatfish species decreased. Moreover, the increase in gadoid abundance seemed to have less effect in more open systems, which showed greater variability in species diversity and evenness compared with more closed ecosystems.