Secondary contact zones between deeply divergent, yet interfertile, lineages provide windows into the speciation process. North American grey foxes (Urocyon cinereoargenteus) are divided into western and eastern lineages that diverged approximately 1 million years ago. These ancient lineages currently hybridize in a relatively narrow zone of contact in the southern Great Plains, a pattern more commonly observed in smaller‐bodied taxa, which suggests relatively recent contact after a long period of allopatry. Based on local ancestry inference with whole‐genome sequencing (n = 43), we identified two distinct Holocene pulses of admixture. The older pulse (500–3500 YBP) reflected unidirectional gene flow from east to west, whereas the more recent pulse (70–200 YBP) of admixture was bi‐directional. Augmented with genotyping‐by‐sequencing data from 216 additional foxes, demographic analyses indicated that the eastern lineage declined precipitously after divergence, remaining small throughout most of the late Pleistocene, and expanding only during the Holocene. Genetic diversity in the eastern lineage was highest in the southeast and lowest near the contact zone, consistent with a westward expansion. Concordantly, distribution modelling indicated that during their isolation, the most suitable habitat occurred far east of today's contact zone or west of the Great Plains. Thus, long‐term isolation was likely caused by the small, distant location of the eastern refugium, with recent contact reflecting a large increase in suitable habitat and corresponding demographic expansion from the eastern refugium. Ultimately, long‐term isolation in grey foxes may reflect their specialized bio‐climatic niche. This system presents an opportunity for future investigation of potential pre‐ and post‐zygotic isolating mechanisms.