Predators often exert strong top-down regulation of prey, but in many systems, juvenile predators must compete with their future prey for a shared resource. In such life-history intraguild predation (LHIGP) systems, prey can therefore also regulate the recruitment and thus population dynamics of their predator via competition. Theory predicts that such stage-structured systems exhibit a wide range of dynamics including alternative stable states. Here we show that cannibalism is an exceedingly common interaction within natural LHIGP systems that determines what coexistence states are possible. Using a modeling approach that simulates a range of ontogenetic niche shift scenarios along a productivity gradient, we demonstrate that only if the predator is competitively dominant can cannibalism promote coexistence by allowing prey to persist. If the prey is competitively dominant, cannibalism instead results in competitive exclusion of the predator and the loss of potential alternative stable states. Further, predator exclusion occurs at low cannibalistic preference relative to empirical estimates and is consistent across LHIGP systems in which the predator undergoes a complete diet shift or diet broadening over ontogeny. Given that prey is frequently competitively dominant in natural systems, our results demonstrate that even weak cannibalism can inhibit predator persistence, prompting exploration of mechanisms that reconcile theory with the common occurrence of such interactions in nature.