The Mexican Spotted Owl (Strix occidentalis lucida) is a threatened subspecies of the southwestern United States and northern Mexico. Although threatened, little is known about its population status. We studied the demography of the Mexican Spotted Owl in one study area in Arizona and one in New Mexico from 1991 to 1997. We estimated annual survival rates (φ), fecundity rates (b), and abundance (N) to test the hypothesis that population trends were stationary. Although annual fecundity rates (b̄ = 0.494 for Arizona and 0.380 for New Mexico) and annual juvenile survival rates (φ̄ = O.179 for Arizona and 0.109 for New Mexico) differed in magnitude between the study areas, they exhibited similar temporal patterns. Annual survival for territorial owls varied randomly in Arizona but declined linearly in New Mexico. Mean annual survival for territorial owls was 0.814 in Arizona and 0.832 for owls ≥ 3 years old and 0.644 for owls 1-2 years old in New Mexico. Based on survival and fecundity estimates, the annual rates of change (λ) indicated that both populations were declining at ≥10% a year. These estimates were corroborated by observed declines in abundance. Some regional factor may have been affecting fecundity, whereas a combination of factors may have been affecting survival. Two possible reasons for the population declines are declines in habitat quality and regional trends in climate.