A perennial issue for land use policy is the evaluation of landscape biodiversity and the associated cost effectiveness of any biodiversity conservation policy actions. Based on the CUA methodology as applied to species conservation, this paper develops a methodology for evaluating the impact on habitats of alternative landscape management scenarios. The method incorporates three dimensions of habitats, quantity change, quality change and relative scarcity, and is illustrated in relation to the alternative landscape management scenarios for the Scottish Highlands (Caimgorms) study area of the BioScene project. The results demonstrate the value of the method for evaluating biodiversity conservation policies through their impact on habitats. (c) 2006 Elsevier B.V. All rights reserved.