Historical records for the Bega district were examined to chart the environmental changes wrought by Europeans through habitat alteration and the introduction of exotic species, and to interpret the impact of these on native mammals. Early recorded increases in native mammal populations, particularly koalas, may have been attributable to a decline in Aboriginal hunting pressure. After settlement in 1830, the valley forest was cleared progressively, ecosystems were altered by grazing and improved pastures, and many introduced plants became weeds in the disturbed environment. The timber industry exploited the forests of the valley and then the slopes of the surrounding mountains. Three exotic mammal species had a major impact on the district — hares, rabbits and foxes. Of the native fauna, the large and medium sized mammal species were those recorded most frequently. Dramatic fluctuations in numbers occurred in most of these species, and many reached plague proportions between 1880 and 1910, after which their numbers fell sharply. The peaks of exotic mammals and the decline of native mammals coincided with the clearing of the remaining forests in the Bega Valley. Many native mammal species are now rare, four are in danger of extinction, and at least six species have become locally extinct since settlement. As most of the native mammal populations in the district now occur in the State Forests surrounding the Bega Valley, the importance of preserving or managing these forests for wildlife must be weighed against proposals to manage the forests for pulpwood (woodchip) production.