Prey response to novel predators influences the impacts on prey populations of introduced predators, bio-control efforts, and predator range expansion. Predicting the impacts of novel predators on native prey requires an understanding of both predator avoidance strategies and their potential to reduce predation risk. We examine the response of island foxes (Urocyon littoralis) to invasion by golden eagles (Aquila chrysaetos). Foxes reduced daytime activity and increased night time activity relative to eagle-naïve foxes. Individual foxes reverted toward diurnal tendencies following eagle removal efforts. We quantified the potential population impact of reduced diurnality by modeling island fox population dynamics. Our model predicted an annual population decline similar to what was observed following golden eagle invasion and predicted that the observed 11% reduction in daytime activity would not reduce predation risk sufficiently to reduce extinction risk. The limited effect of this behaviorally plastic predator avoidance strategy highlights the importance of linking behavioral change to population dynamics for predicting the impact of novel predators on resident prey populations.