Stressful environmental conditions limit survival, growth, and reproduction, or these conditions induce resting stages indicated as dormancy. Tardigrades represent one of the few animal phyla able to perform both forms of dormancy: quiescence and diapause. Different forms of cryptobiosis (quiescence) are widespread and studied, while little attention has been devoted to adaptive meaning of the encystment (diapause). Our goal was to determine environmental factors and token stimuli involved in the encystment process of tardigrades. The eutardigrade, Amphibolus volubilis, a species able to produce two types of cysts (type 1 and type 2), has been considered. Laboratory experiments and long-term study on cyst dynamics of a natural population were conducted. Laboratory experiments demonstrate that active tardigrades collected in April produced mainly type 2 cysts, whereas animals collected in November produced mainly type 1 cysts, indicating that the different responses are functions of the physiological state at the time they were collected. Dynamics of the two types of cyst show opposite seasonal trends: type 2 cysts are present only during the warm season and type 1 cysts, present during the cold season. Temperature represents the environmental factor involved in induction, maintenance, and termination of the cyst. We also evidenced that A. volubilis is able to perform both diapause and cryptobiosis, even overlapping the two phenomena. The induction phase of tardigrade encystment can be compared to the induction phase of insect diapause, also indicating an involvement of endogenous factors in tardigrade encystment. As in insect diapause, tardigrade encystment can be considered a diapausing state controlled by exogenous and endogenous stimuli.