We studied the nesting ecology of the Chimango Caracara (Milvago chimango), a common yet poorly known raptor on Chiloé Island, southern Chile, during two breeding seasons. Deforestation and land clearing in this landscape may be benefiting this raptor, which is tolerant of open and disturbed habitats and human activity. Chimangos nested at different heights in a variety of trees and shrubs, but nests were always well concealed because they were placed centrally and in dense vegetation within the substrate. Egg laying occurred in most nests in October during both years; the most common clutch sizes were 2 or 3 eggs. The incubation and nestling periods were approximately 5 (2 nests) and 6 (1 nest) weeks, respectively. Nest success (Mayfield) for 72 nests averaged 57% for the two years. Productivity averaged 1.22 ± 0.11 fledglings per active nest and did not differ between years. For nests located during both years (n = 15), productivity was slightly higher in 1997–1998 and more nests failed in 1998–1999. Two pairs attempted to renest after nest failure but were not successful. Habitat and landscape features associated with high productivity of chimango nests included exotic trees and shrubs, tidal flats, linear forest strips, and occupied houses or barns. Successful nesting was associated with exotic trees and shrubs. Nesting density was highest along beaches, although not all pairs that built nests along beaches laid eggs. Successful nests along beaches fledged twice as many young as inland nests. Continued clearing of the rainforest in this region may provide increased foraging opportunities for this raptor but may also result in fewer nest sites.