Mountain forests only cover ~25% of all mountain regions but host disproportionally more species compared to other mountain ecosystems. While remote sensing shows that mountain forest loss rate increased linearly from 2001 to 2020, the impact of forest loss on mountain species, and the effectiveness of formal protection, remain unclear. We find that forest loss impacted unevenly on biodiversity, with about one-quarter of mountain forest species experiencing disproportionate habitat loss and narrowly distributed species being most affected. Although susceptible to wildfires, protected forests were largely effective against forest loss. We report a substantial mismatch between mountains that are largely protected and mountains comprising rich biodiversity. Increased conservation efforts are required to safeguard montane biodiversity from forest loss in line with the Kunming-Montreal Global Biodiversity Framework.