Both landscape structure and population size fluctuations influence population genetics. While independent effects of these factors on genetic patterns and processes are well studied, a key challenge is to understand their interaction, as populations are simultaneously exposed to habitat fragmentation and climatic changes that increase variability in population size. In a population network of an alpine butterfly, abundance declined 60–100% in 2003 because of low over-winter survival. Across the network, mean microsatellite genetic diversity did not change. However, patch connectivity and local severity of the collapse interacted to determine allelic richness change within populations, indicating that patch connectivity can mediate genetic response to a demographic collapse. The collapse strongly affected spatial genetic structure, leading to a breakdown of isolation-by-distance and loss of landscape genetic pattern. Our study reveals important interactions between landscape structure and temporal demographic variability on the genetic diversity and genetic differentiation of populations. Projected future changes to both landscape and climate may lead to loss of genetic variability from the studied populations, and selection acting on adaptive variation will likely occur within the context of an increasing influence of genetic drift.