Livestock grazing is a key factor in many grassland ecosystems and can substantially influence the conservation of grassland species. The Crau steppe in southern France is a protected area that is traditionally grazed by sheep. The Critically Endangered Crau plain grasshopper Prionotropis rhodanica is endemic to the area and a flagship for the conservation of this unique ecosystem. Its population has declined significantly during the last 2 decades, but the reasons remain poorly understood. One potential factor is an altered habitat structure caused by changes in the grazing regime. We examined the microhabitat preferences of the species and compared the habitat structure of populated sites with those where the species is now extinct (former habitat). We found that populated sites had denser and higher vegetation, whereas former habitat had higher cover of stones and bare ground. Vegetation structure in the habitat of the smallest subpopulation was similar to areas of former habitat, suggesting a marginal habitat quality. Our results show that P. rhodanica requires 50–70% vegetation cover and suggest that grazing has contributed considerably to the population decline, but it remains unclear whether this is a direct effect of habitat degradation or an indirect effect by attracting predators associated with grazing activities. We recommend careful management of grazing to improve habitat quality, which would also benefit other invertebrates and insectivores. Continued monitoring is required to conserve habitat specialists in protected areas.