Since boreal forest fragments are of lower quality than contiguous forest for breeding Ovenbirds (Seiurus aurocapillus), we predicted that competition for breeding sites in contiguous forest should lead to a greater prevalence of individuals in better condition in these habitats. We quantified male condition using morphological and hematological indices. Males in contiguous forest were larger than males in forest fragments and had higher hematocrits and mean corpuscular volumes, as well as a greater prevalence of polychromatic cells. These hematological indices are all positively associated with energy demands or stress, or both. Furthermore, the proportion of heterophils, a type of white blood cell positively associated with stress, decreased through the breeding season only for males in forest fragments. Total plasma protein and mass corrected for structural size did not differ between landscapes, suggesting that the nutritional status of males was similar between landscapes. All of these trends were independent of age. Overall, these results indicate that size of male Ovenbirds could be playing a role in habitat selection, but that defending territories in contiguous forest, where breeding success is higher and populations are denser, seems to result in greater energetic demands and a reduced immunological condition. These results demonstrate a physiological component to contrasting consequences associated with territory acquisition in birds.