Historically, the Powerful Owl (Ninox strenua) has been seen as a southeastern Australian species restricted to, or most numerous in, dense gullies of tall open forests in hilly or mountainous areas of the coast and Great Divide. However, recent research has revealed that Powerful Owls may breed numerously and successfully in a wider range of habitats than previously believed, including the forests and woodlands within the metropolitan areas of some major cities.Here we report on the breeding of a number of pairs of Powerful Owls in the Yarra Valley, Victoria. Study sites ranged from relatively undisturbed, wet sclerophyll forest 80 km from central Melbourne, through dry sclerophyll, eucalypt-dominated open forest with some disturbance, to a highly disturbed urban parkland only 18 km from central Melbourne. We found that Powerful Owls breed successfully in some urban areas, but are limited in the amount of human disturbance they can tolerate near their nesting hollow. In the most heavily utilized section of the urban parkland, all breeding attempts were unsuccessful and in one year the young were apparently eaten by one of the parents. This followed construction of a timber boardwalk under the nest tree during the breeding season. The Powerful Owls subsequently moved to a more secluded nesting hollow and raised two young. Recommendations for management of Powerful Owls in urban areas are discussed in the context of these results.