Two Iberian wolf Canis lupus signatus packs were studied in the north of Portugal during spring and summer 1996. The study areas are located in two mountainous areas close to the Spanish border. Both regions presented a very low density of wild ungulates and intensive livestock production. The food habits and the livestock depredation of the wolves were considered. The study material included 87 dropping samples, interviews with shepherds, carcass investigation and government reports of livestock depredation. Prey preference was measured in both areas. Wolves fed exclusively on livestock, especially goats. Wolf attacks on goats affected mostly large flocks of > 100 heads, but where there were horses, wolves preyed preferentially on horses. In both study areas, sheep was recorded as a regular prey by the government reports but never appeared in the scat analysis results. This apparent contradiction will be discussed. The wolf's dependence on livestock can be explained by the scarcity of wild prey and the high density of livestock. Conservation of wolves in such impoverished areas depends on an efficient livestock depredation management plan and the reintroduction of native prey species.