The crossover from fluctuating atomic constituents to a collective state as one lowers temperature or energy is at the heart of the dynamical mean-field theory description of the solid state. We demonstrate that the numerical renormalization group is a viable tool to monitor this crossover in a real-materials setting. The renormalization group flow from high to arbitrarily small energy scales clearly reveals the emergence of the Fermi-liquid state of Sr$_2$RuO$_4$. We find a two-stage screening process, where orbital fluctuations are screened at much higher energies than spin fluctuations, and Fermi-liquid behavior, concomitant with spin coherence, below a temperature of 25 K. By computing real-frequency correlation functions, we directly observe this spin--orbital scale separation and show that the van Hove singularity drives strong orbital differentiation. We extract quasiparticle interaction parameters from the low-energy spectrum and find an effective attraction in the spin-triplet sector.
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