Reedbeds of the Rhône river delta, southern France, constitute an important breeding habitat for purple herons (Ardea purpurea) in Europe. However, the area of reed harvested commercially has increased in recent years and, since 1997, a European Union agri-environmental policy has been implemented to reconcile economic development with conservation goals for harvested reedbeds. Here, we investigate trends in breeding numbers of purple herons and the effect of reed harvesting on reedbed occupancy by herons. A regression model indicates that reedbed use by breeding herons was negatively affected by the reed harvesting pressure. An increase of nearly 50% in the harvested area following the implementation of the policy was probably caused by subsidies (from 67 to 100 US$/ha/year) proposed to reed harvesters, although associated with harvesting constraints intended to conserve heron colonies. The difference between the payments with and without colonies does not appear to have been sufficient to convince reed harvesters to conserve colonies. A case study showed that one heron colony located in a reserve area persisted, while another split into smaller colonies following modifications of reedbeds for future reed harvesting. Results suggest that the agri-environmental policy in its present form has failed to accomplish its primary objective of improving conditions for breeding purple herons in the Camargue. Potential breeding habitat for purple herons have decreased and urgent action is needed to protect some reedbeds from intense reed cutting.