Ecological restoration is increasingly applied in tropical forests to mitigate biodiversity loss and recover ecosystem functions. In restoration ecology, functional richness, rather than species richness, often determines community assembly, and measures of functional diversity provide a mechanistic link between diversity and ecological functioning of restored habitat. Vertebrate animals are important for ecosystem functioning. Here we examine the functional diversity of small-to-medium sized mammals to evaluate the diversity and functional recovery of tropical rainforest. We assess how mammal species diversity and composition, and functional diversity and composition vary along a restoration chronosequence from degraded pasture to ‘old-growth’ tropical rainforest in the Wet Tropics of Australia. Species richness, diversity, evenness and abundance did not vary, but total mammal biomass and mean species body mass increased with restoration age. Species composition in restoration forests converged on the composition of old-growth rainforest and diverged from pasture with increasing restoration age. Functional metrics provided a clearer pattern of recovery than traditional species metrics, with most functional metrics significantly increasing with restoration age when taxonomic-based metrics did not. Functional evenness and dispersion increased significantly with restoration age, suggesting that niche complementarity enhances species’ abundances in restored sites. The change in community composition represented a functional shift from invasive, herbivorous, terrestrial habitat generalists and open environment specialists in pasture and young restoration sites, to predominantly endemic, folivorous, arboreal and fossorial forest species in older restoration sites. This shift has positive implications for conservation and demonstrates the potential of tropical forest restoration to recover rainforest-like, diverse faunal communities.