As a result of habitat fragmentation, the capercaillie (Tetrao urogallus) population in the Black Forest mountain range in southwestern Germany has declined rapidly during the last decades and now persists in patchy isolated fragments. To study the effects of fragmentation, we quantified dispersal patterns by genotyping 213 individuals in four subpopulations. We used a landscape genetics approach to analyse individual genetic variation, and despite overall low genetic structure, we found strong indications for a major boundary separating the northern part of the Black Forest area from the other subpopulations. Males and females display different gene flow patterns across the landscape. Females tend to disperse across longer distances than do males. We additionally studied the effects of the population decline on genetic diversity during the last hundred years. Although the population has dramatically declined from over 4000 to 250 males over a few decades, genetic diversity was not affected in the same way. We found two haplotypes that were present only in historic samples but microsatellite markers revealed no significant reduction in genetic diversity. Among historic samples, genetic differentiation was very low, indicating that the current genetic structure is caused by recent habitat fragmentation. We argue that inferences about reduced genetic diversity are drawn cautiously and recommend sampling over different temporal scales.