Significant changes in the distribution and persistence of species have been driven by Pleistocene cyclical climate changes and, more recently, by human modification of the environment. In eastern Australia, Pleistocene cyclical patterns in temperature and aridity led to the expansion and retraction of rainforest and likely affected the distribution of the koala (Phascolarctos cinereus, family Phascolarctidae), a species preferring dry or open woodland. More recently, anthropogenic landscape modification has led to a large-scale change in distribution of the koala following the destruction of approx. 75 000 ha of subtropical rainforest in north-east New South Wales termed the ‘Big Scrub’. Sharing of the control region haplotypes to the north and south of this region indicate historical connectivity of coastal koala populations. However, the majority (110/115) of sampled koalas from this region shared a single mitochondrial control region haplotype, suggesting that koalas did not persist in multiple refugial pockets within a heterogenous rainforest but expanded into the region following deforestation. Bayesian cluster analysis of microsatellite data consistently identified two clusters of koalas. One cluster, in the north of the area, had high microsatellite diversity (10 alleles per locus, He = 0.79) and clustered with koalas further to the north, thus suggesting a southerly expansion into the cleared area. To the south was a cluster with significantly lower diversity (six alleles per locus, He = 0.59, P < 0.001). It is possible there has been restricted or filtered movement of koalas between these clusters, which coincides with a cleared river valley and associated roads or immigration from populations both to the north and to the south. This study gives an insight into the timescale of changes in species distribution following rapid alterations to suitable habitat.