Woody plant encroachment into grasslands is a global concern. Efforts to restore grasslands often assume that removal of woody plants benefits biodiversity but assumptions are rarely tested. In the Chihuahuan Desert of the Southwestern United States, we tested whether abundances of grassland specialist bird species would be greater in plant communities resulting from treatment with herbicides to remove encroaching shrubs compared with untreated shrub-dominated areas that represented pre-treatment conditions. In 2010, we surveyed breeding birds and vegetation at 16 treated–untreated pairs. In 2011, we expanded the survey effort to 21 treated–untreated pairs, seven unpaired treatment areas, and five reference grassland areas. Vegetation in treatment areas had higher perennial grass foliar and basal cover and lower shrub foliar cover compared with untreated areas. Several regionally declining grassland specialists exhibited higher occurrence and relative abundance in treated areas. A shrubland specialist, however, was associated with untreated areas and may be negatively impacted by shrub removal. Bird community composition differed between treated and untreated areas in both years. Our results indicate that shrub removal can have positive effects on grassland specialist bird species, but that a mosaic of treated and untreated areas might be most beneficial for regional biodiversity.