Chloroplast microsatellites are becoming increasingly popular markers for population genetic studies in plants, but there has been little focus on their potential for demographic inference. In this work the utility of chloroplast microsatellites for the study of population expansions was explored. First, we investigated the power of mismatch distribution analysis and the FS test with coalescent simulations of different demographic scenarios. We then applied these methods to empirical data obtained for the Canary Island pine (Pinus canariensis). The results of the simulations showed that chloroplast microsatellites are sensitive to sudden population growth. The power of the FS test and accuracy of demographic parameter estimates, such as the time of expansion, were reduced proportionally to the level of homoplasy within the data. The analysis of Canary Island pine chloroplast microsatellite data indicated population expansions for almost all sample localities. Demographic expansions at the island level can be explained by the colonization of the archipelago by the pine, while population expansions of different ages in different localities within an island could be the result of local extinctions and recolonization dynamics. Comparable mitochondrial DNA sequence data from a parasite of P. canariensis, the weevil Brachyderes rugatus, supports this scenario, suggesting a key role for volcanism in the evolution of pine forest communities in the Canary Islands.