Deleterious mutation accumulation has been implicated in many biological phenomena and as a potentially significant threat to human health and the persistence of small populations. The vast majority of mutations with effects on fitness are known to be deleterious in a given environment, and their accumulation results in mean population fitness decline. However, whether populations are capable of recovering from negative effects of prolonged genetic bottlenecks via beneficial or compensatory mutation accumulation has not previously been tested. To address this question, long-term mutation-accumulation lines of the nematode Caenorhabditis elegans, previously propagated as single individuals each generation, were maintained in large population sizes under competitive conditions. Fitness assays of these lines and comparison to parallel mutation-accumulation lines and the ancestral control show that, while the process of fitness restoration was incomplete for some lines, full recovery of mean fitness was achieved in fewer than 80 generations. Several lines of evidence indicate that this fitness restoration was at least partially driven by compensatory mutation accumulation rather than a result of a generic form of laboratory adaptation. This surprising result has broad implications for the influence of the mutational process on many issues in evolutionary and conservation biology.