The interplay of evolution and development has been at the heart of evolutionary theory for more than a century. Heterochrony—change in the timing or rate of developmental events—has been implicated in the evolution of major vertebrate lineages such as mammals, including humans. Birds are the most speciose land vertebrates, with more than 10,000 living species representing a bewildering array of ecologies. Their anatomy is radically different from that of other vertebrates. The unique bird skull houses two highly specialized systems: the sophisticated visual and neuromuscular coordination system allows flight coordination and exploitation of diverse visual landscapes, and the astonishing variations of the beak enable a wide range of avian lifestyles. Here we use a geometric morphometric approach integrating developmental, neontological and palaeontological data to show that the heterochronic process of paedomorphosis, by which descendants resemble the juveniles of their ancestors, is responsible for several major evolutionary transitions in the origin of birds. We analysed the variability of a series of landmarks on all known theropod dinosaur skull ontogenies as well as outgroups and birds. The first dimension of variability captured ontogeny, indicating a conserved ontogenetic trajectory. The second dimension accounted for phylogenetic change towards more bird-like dinosaurs. Basally branching eumaniraptorans and avialans clustered with embryos of other archosaurs, indicating paedomorphosis. Our results reveal at least four paedomorphic episodes in the history of birds combined with localized peramorphosis (development beyond the adult state of ancestors) in the beak. Paedomorphic enlargement of the eyes and associated brain regions parallels the enlargement of the nasal cavity and olfactory brain in mammals. This study can be a model for investigations of heterochrony in evolutionary transitions, illuminating the origin of adaptive features and inspiring studies of developmental mechanisms.