Animals cope with environmental perturbations through the stress response, a set of behavioural and physiological responses aimed to maintain and/or return to homeostasis and enhance fitness. Vertebrate neuroendocrine axis activation in response to environmental stressors can result in the secretion of glucocorticoids (GCs), whose acute increases may be adaptive, while chronic elevation may be detrimental. Invasive grey squirrels ( Sciurus carolinensis ) act as a stressor eliciting elevation of GCs in native red squirrels ( Sciurus vulgaris ). Here we used 6-year data of variation in faecal glucocorticoid metabolite (FGM) concentrations following invasion by grey squirrels in three red squirrel populations, to identify if red squirrels showed physiological habituation to this stressor. The decrease in FGMs over time was more pronounced shortly after invasion and at high densities of grey squirrels while it decreased less strongly and was no longer influenced by the invader density as time since invasion elapsed. At the individual level, FGMs also decreased more markedly as each red squirrel experienced prolonged contact with the invader. Our study provides compelling new data suggesting that native species in the wild can habituate to prolonged contact with invasive species, showing that they may avoid the potentially harmful effects of chronic elevations in GCs.