Six variable microsatellite loci were used to examine genetic structuring in the closely related shy albatross (Thalassarche cauta) and white-capped albatross (T. steadi). First, levels of genetic differentiation between the species, and among three populations within each species, were analysed using amova, FST and RST. We found high levels of genetic structuring and detected many unshared alleles between the species, which provide strong evidence against any contemporary gene flow between them. Within each species, shy albatross populations were found to be genetically distinct whereas white-capped albatross populations were undifferentiated, which implies that dispersal events are much rarer in the former than in the latter. These results formed the basis for the recommendation that the three white-capped albatross populations (as a whole) and each shy albatross population be treated as separate units for conservation. Second, levels of genetic diversity and allelic patterns in shy and white-capped albatrosses were assessed for whether they support earlier mtDNA results suggesting that shy albatrosses arose through range expansion of white-capped albatrosses. All measures indicated lower genetic diversity within shy albatrosses than within white-capped albatrosses and upheld the hypothesis that shy albatrosses were founded by white-capped albatrosses.