<p>Tropical forests are ‘cradles of biodiversity’, and monitoring species and communities is even more challenging for conservation and management of biodiversity. Structures such as tree microhabitats are recommended as surrogates of biodiversity for sustainable management of forests in the European and Mediterranean regions. Indicator potential of these structures in tropical regions is not assessed which limits the utilization of this tool in tropical forests. Indicator potential of tree microhabitats was assessed for habitat heterogeneity (presence of cavity), cavity-user and non-user avifauna in the southern Western Ghats region of India, a biodiversity hotspot. Tree microhabitats were classified into nine categories and 33 sub categories and for estimating indicator potential using <i>IndVal</i> method. Cavity bearing trees and cavities increase complexity and heterogeneity in habitat. The tree microhabitats injuries and exposed wood, epiphytic and epixylic structures, crown deadwood, excrescences and growth forms and <i>Crematogaster</i> ant nests were significant indicator of cavity bearing trees and cavity presence. Crown deadwood, growth forms such as buttresses, seams, and flutes, epiphytic and epixylic structures, fungal fruiting bodies, injuries and exposed wood, and <i>Crematogaster</i> ant nests were significant indicators of avifauna diversity. These structures were also significant indicators for primary and secondary cavity-using avifauna as they provide nesting and feeding resources. Thus, deadwood on living trees, snags, buttress, flutes, and epiphytes were potential indicators of avifauna diversity and their habitat resources in tropical forests, and hence of ecosystem integrity. Retention of these structures and their integration as habitat monitoring parameters can improve conservation efforts and resilience in tropical ecosystems.</p>