<p>Overgrazing by ungulates is known to trigger ecosystem restructuring and negatively affect understory-nesting birds. However, its cascading effects on canopy-nesting avifauna remain poorly understood. We compared avian community responses between a low-density baseline phase (2018) and a high-density overgrazing phase (2023–2024) in a coastal engineered forest affected by the overgrazing of reintroduced Père David’s deer (<i>Elaphurus davidianus</i>) to evaluate the impacts on canopy-nesting bird assemblages. Surveys assessed the vegetation structure and avian nesting patterns across the study period. Our investigation revealed three key findings: (1) Comparison between the baseline (2018) and the overgrazing phase (2023, 2024) revealed severe degradation, with shrub density declining by 80.1%, shrub cover by 73.3%, and herbaceous cover by 27.2%, followed by vegetation stabilization in 2023–2024; (2) Avian communities underwent statistically significant restructuring (<i>P</i> &lt; 0.001), with a 42.9% drop in species richness. The Red-collared Dove (<i>Streptopelia tranquebarica</i>) showed a contrasting 187.5% surge, replacing the Yellow-billed Grosbeak as the dominant species in the degraded habitat.; (3) Resource selection modeling demonstrated that nest concealment and canopy location primarily governed Red-collared Dove nest-site selection, with preference for moderately concealed sites (concealment levels 5–6). Our study demonstrates that deer overgrazing triggers a “winners and losers” dynamics among canopy-nesting birds, with net negative consequences for avian diversity. We advocate evidence-based deer population management coupled with targeted understory restoration to mitigate these impacts.</p> Graphical abstract <p></p>