Yes! And the tree dwellers are vegetarians and pacifists, and the ground dwellers are sort of Morlock types who remember when there used to be war. They made a video game out of it back in the days of Commodore 64s, and it remains my favourite video game ever. Anyway, I found out that the game was based on books, so I managed to hunt them down even though they were out of print even back then.

I hesitate to try to find the books again because I suspect I won't like them as much now, but they made an aspiring hippie vegetarian 8-year-old very, very happy.