For some salmon populations, the individual and population effects of sea lice (Lepeophtheirus salmonis) transmission from sea cage salmon farms is probably mediated by predation, which is a primary natural source of mortality of juvenile salmon. We examined how sea lice infestation affects predation risk and mortality of juvenile pink (Oncorhynchus gorbuscha) and chum (O. keta) salmon, and developed a mathematical model to assess the implications for population dynamics and conservation. A risk-taking experiment indicated that infected juvenile pink salmon accept a higher predation risk in order to obtain foraging opportunities. In a schooling experiment with juvenile chum salmon, infected individuals had increased nearest-neighbor distances and occupied peripheral positions in the school. Prey selection experiments with cutthroat trout (O. clarkii) predators indicated that infection reduces the ability of juvenile pink salmon to evade a predatory strike. Group predation experiments with coho salmon (O. kisutch) feeding on juvenile pink or chum salmon indicated that predators selectively consume infected prey. The experimental results indicate that lice may increase the rate of prey capture but not the handling time of a predator. Based on this result, we developed a mathematical model of sea lice and salmon population dynamics in which parasitism affects the attack rate in a type II functional response. Analysis of the model indicates that: (1) the estimated mortality of wild juvenile salmon due to sea lice infestation is probably higher than previously thought; (2) predation can cause a simultaneous decline in sea louse abundance on wild fish and salmon productivity that could mislead managers and regulators; and (3) compensatory mortality occurs in the saturation region of the type II functional response where prey are abundant because predators increase mortality of parasites but not overall predation rates. These findings indicate that predation is an important component of salmon–louse dynamics and has implications for estimating mortality, reducing infection, and developing conservation policy.