Habitat fragmentation can act to cause repro-ductive isolation between conspecifics and undermine species' persistence, though most studies have reported the genetic condition of populations that have already declined to a very small size. We examined genetic diversity within the vulnerable, declining koala (Phascolarctos cinereus) population in Southeast Queensland, Australia to determine the genetic impact of ongoing threatening processes. Five hundred and twelve koalas from ten Southeast Queensland Local Government Areas on the mainland and one island were genotyped at six polymorphic microsatellite loci. Based on Bayesian cluster analysis incorporating spatial data, the regional koala population was subdivided into six clusters, with location of major roads and rivers appearing to be consistent with being barriers to gene flow. The distribution of mtDNA control region haplotypes identified distinct coastal and inland clades suggesting that histori-cally there was gene flow between koalas along the coast (though little interchange between coastal and inland ani-mals). In contrast, koalas from the Koala Coast (Brisbane City, Logan City and Redland Shire) were shown by microsatellite analysis to be genetically distinct from adjacent areas. It is likely, therefore, that more recent reductions in population size and restricted gene flow through urbanisation have contributed to the genetic dif-ferentiation of koalas in the Koala Coast region.