For mammals today, mountains are diverse ecosystems globally, yet the strong relationship between species richness and topographic complexity is not a persistent feature of the fossil record. Based on fossil-occurrence data, diversity and diversification rates in the intermontane western North America varied through time, increasing significantly during an interval of global warming and regional intensification of tectonic activity from 18 to 14 Ma. However, our ability to infer origination and extinction rates reliably from the fossil record is affected by variation in preservation history. To investigate the influence of preservation on estimates of diversification rates, I simulated fossil records under four alternative diversification hypotheses and six preservation scenarios. Diversification hypotheses included tectonically-controlled speciation pulses, while preservation scenarios were based on common trends (e.g., increasing rock record towards the present) or derived from fossil occurrences and the continental rock record. For each scenario, I estimated origination, extinction, and diversification rates using three standard methods—per-capita, three-timer, and capture-mark-recapture metrics—and evaluated the ability of the simulated fossil records to accurately recover the underlying diversification dynamics. Despite variable and low preservation probabilities, simulated fossil records retained the signal of true rates in several of the scenarios. The three metrics did not exhibit similar behavior under each preservation scenario: while three-timer and capture-mark-recapture metrics produced more accurate rate estimates, per-capita rates tended to better reproduce true shifts in origination rates. All metrics suffered from spurious peaks in origination and extinction rates when highly volatile preservation impacted the simulated record. Results from these simulations indicate that elevated diversification rates in relation to tectonic activity during the middle Miocene are likely to be evident in the fossil record, even if preservation in the North American fossil record was variable. Input from the past is necessary to evaluate the ultimate mechanisms underlying speciation and extinction dynamics.