The emergence and abundance of cooperation in nature poses a tenacious and challenging puzzle to evolutionary biology. Cooperative behaviour seems to contradict Darwinian evolution because altruistic individuals increase the fitness of other members of the population at a cost to themselves. Thus, in the absence of supporting mechanisms, cooperation should decrease and vanish, as predicted by classical models for cooperation in evolutionary game theory, such as the Prisoner's Dilemma and public goods games. Traditional approaches to studying the problem of cooperation assume constant population sizes and thus neglect the ecology of the interacting individuals. Here, we incorporate ecological dynamics into evolutionary games and reveal a new mechanism for maintaining cooperation. In public goods games, cooperation can gain a foothold if the population density depends on the average population payoff. Decreasing population densities, due to defection leading to small payoffs, results in smaller interaction group sizes in which cooperation can be favoured. This feedback between ecological dynamics and game dynamics can generate stable coexistence of cooperators and defectors in public goods games. However, this mechanism fails for pairwise Prisoner's Dilemma interactions and the population is driven to extinction. Our model represents natural extension of replicator dynamics to populations of varying densities.