1. A predictive framework of community and ecosystem dynamics that applies across systems has remained elusive, in part because non-consumptive predator effects are often ignored. Further, it is unclear how much individual-level detail community models must include. 2. Previous studies of short-lived species suggest that state-dependent decisions add little to our understanding of community dynamics. Body condition-dependent decisions made by long-lived herbivores under risk of predation, however, might have greater community-level effects. This possibility remains largely unexplored, especially in marine environments. 3. In the relatively pristine seagrass community of Shark Bay, Australia, we found that herbivorous green sea turtles (Chelonia mydas Linnaeus, 1758) threatened by tiger sharks (Galeocerdo cuvier Peron and LeSueur, 1822) select microhabitats in a condition-dependent manner. Turtles in poor body condition selected profitable, high-risk microhabitats, while turtles in good body condition, which are more abundant, selected safer, less profitable microhabitats. When predation risk was low, however, turtles in good condition moved into more profitable microhabitats. 4. Condition-dependent use of space by turtles shows that tiger sharks modify the spatio-temporal pattern of turtle grazing and their impacts on ecosystem dynamics (a trait-mediated indirect interaction). Therefore, state-dependent decisions by individuals can have important implications for community dynamics in some situations. 5. Our study suggests that declines in large-bodied sharks may affect ecosystems more substantially than assumed when non-lethal effects of these top predators on mesoconsumers are not considered explicitly.