Coastal subsidence causes sea-level rise, shoreline erosion and wetland loss, which poses a threat to coastal populations. This is especially evident in the Mississippi Delta in the southern United States, which was devastated by Hurricane Katrina in 2005. The loss of protective wetlands is considered a critical factor in the extensive flood damage. The causes of subsidence in coastal Louisiana, attributed to factors as diverse as shallow compaction and deep crustal processes, remain controversial. Current estimates of subsidence rates vary by several orders of magnitude. Here, we use a series of radiocarbon-dated sediment cores from the Mississippi Delta to analyse late Holocene deposits and assess compaction rates. We find that millennial-scale compaction rates primarily associated with peat can reach 5mm per year, values that exceed recent model predictions. Locally and on timescales of decades to centuries, rates are likely to be 10 mm or more per year. We conclude that compaction of Holocene strata contributes significantly to the exceptionally high rates of relative sea-level rise and coastal wetland loss in the Mississippi Delta, and is likely to cause subsidence in other organic-rich and often densely populated coastal plains.