Recovery and persistence of cactus ferruginous pygmy-owls (Glaucidium brasilianum cactorum) in Arizona will likely depend on owls from northern Sonora, Mexico, where they are more common. In Organ Pipe Cactus National Monument (OPCNM), abundance of pygmy-owls varies annually and the owl population may be supported by individuals dispersing from neighboring northern Sonora, Mexico. Therefore, determining trends in populations of pygmy-owls and their habitat in Sonora is important for long-term persistence and management of pygmy-owls. We monitored populations of pygmy-owls in northern Sonora between 2000 and 2004 and surveyed potential pygmy-owl habitat in northern Sonora near OPCNM in 2004. We found evidence of a 9.2% (SE = 2.5%) decline per year in abundance (P = 0.0004) between 2000 and 2004. The decline was greatest in areas where the height of upland vegetation, relative abundance of saguaro cacti (Carnegia gigantea), and coverage of riparian vegetation were low, and where intensity of land-use was high. We found no trends in rates of territory occupancy between 2002 and 2004 and productivity between 2001 and 2004, although evidence of a decline in nest success between 2001 and 2004 was inconclusive. Territory occupancy and nest success were lower in Semidesert Grasslands than in Arizona Upland desertscrub and did not vary between watersheds near OPCNM and other watersheds in northern Sonora. Although we failed to detect pygmy-owls within 15 km of OPCNM, even at sites occupied in previous years, we found several occupied nests between 20 and 65 km of OPCNM and identified areas of potential habitat and local threats to pygmy-owls and their habitat near OPCNM.