Abstract The modulation of chorus waves on several‐second timescales in Earth’s magnetosphere plays a crucial role in modulating electron precipitation intensity, leading to the formation of pulsating aurora. However, the physical mechanism underlying chorus modulation remains not fully understood. In this study, we perform self‐consistent particle‐in‐cell simulations with typical magnetospheric plasma parameters to quantify chorus modulation driven by plasma density variations and compressional magnetic field fluctuations. It is demonstrated that chorus modulation is determined by nonlinear wave‐particle interactions, in which the condition for nonlinear wave growth is highly sensitive to background plasma parameters. The resulting electron precipitation in the ∼10–200 keV energy range exhibits modulation on comparable timescales, consistent with observations of pulsating aurora. This study enhances our understanding of how variations in magnetospheric plasma parameters influence chorus wave excitation and the associated particle dynamics.