We studied breeding dark-eyed juncos (Junco hyemalis), yellow-rumped warblers (Dendroica coronata), and spruce-nesting birds from 1997 to 1998 among forests with different levels of spruce (Picea spp.) mortality following an outbreak of spruce beetles (Dendroctonus rufipennis) in Alaska, USA. We identified species using live and beetle-killed spruce for nest sites and monitored nests to determine how the outbreak influenced avian habitat selection and reproduction. We tested predictions that 1) nesting success of ground-nesting juncos would increase with spruce mortality due to proliferation of understory vegetation available to conceal nests from predators, 2) nesting success of canopy-nesting warblers would decrease with spruce mortality due to fewer live spruce in which to conceal nests, and 3) both species would alter nest-site selection in response to disturbance. Juncos did not benefit from changes in understory vegetation; nesting success in highly disturbed stands (46%) was comparable to that in undisturbed habitats throughout their range. In stands with low spruce mortality, nesting success of juncos was low (5%) and corresponded with high densities of red squirrels (Tamiasciurus hudsonicus). Yellow-rumped warblers nested exclusively in spruce, but success did not vary with spruce mortality. As disturbance increased, nesting warblers switched from selecting forest patches with high densities of live white spruce (Picea glauca) to patches with beetle-killed spruce. Warblers also placed nests in large-diameter live or beetle-killed spruce, depending on which was more abundant in the stand, with no differences in nesting success. Five of the 12 other species of spruce-nesting birds also used beetle-killed spruce as nest sites. Because beetle-killed spruce can remain standing for >50 years, even highly disturbed stands provide an important breeding resource for boreal forest birds. We recommend that boreal forest managers preserve uncut blocks of infested forest within managed forest landscapes and practice partial harvest of beetle-killed spruce rather than commercial clear-cutting of infested stands in order to sustain breeding bird populations until natural reforestation occurs. Because breeding densities do not always reflect fitness, assessing impacts of a massive natural disturbance should include measuring impacts of changes in vegetation on both reproductive success and predator–prey dynamics.