Bacteria have evolved many defenses against invading viruses (phage). Despite the many bacterial defenses and phage counterdefenses, in most environments, bacteria and phage coexist, with neither driving the other to extinction. How is coexistence realized in the context of the bacteria/phage arms race, and how are immune repertoire sizes determined in conditions of coexistence? Here we develop a simple mathematical model to consider the evolutionary and ecological dynamics of competing bacteria and phage with different immune/counterimmune repertoires. We find an ecologically stable fixed point exhibiting coexistence, in agreement with the experimental observation that each individual bacterium typically carries multiple defense systems, though fewer than the maximum number possible. However, in simulations, the populations typically remain dynamic, exhibiting chaotic fluctuations around this fixed point. These dynamics enable coexistence even when phage (predator) strains outnumber bacteria (prey) strains. We obtain quantitative predictions for the mean, amplitude, and timescale of these dynamics. Our results provide a framework for understanding the evolutionary and ecological dynamics of the bacteria/phage arms race and demonstrate how bacteria/phage coexistence can stably arise from the coevolution of bacterial defense systems and phage counterdefense systems.