The persistence of wildlife species in fire‐prone ecosystems is under increasing pressure from global change, including alterations in fire regimes caused by climate change. However, unburned islands might act to mitigate negative effects of fire on wildlife populations by providing habitat in which species can survive and recolonize burned areas. Nevertheless, the characteristics of unburned islands and their role as potential refugia for the postfire population dynamics of wildlife species remain poorly understood. We used a newly developed unburned island database of the northwestern United States from 1984 to 2014 to assess the postfire response of the greater sage‐grouse (Centrocercus urophasianus), a large gallinaceous bird inhabiting the sagebrush ecosystems of North America, in which wildfires are common. Specifically, we tested whether prefire and postfire male attendance trends at mating locations (leks) differed between burned and unburned areas, and to what extent postfire habitat composition at multiple scales could explain such trends. Using time‐series of male counts at leks together with spatially explicit fire history information, we modeled whether male attendance was negatively affected by fire events. Results revealed that burned leks often exhibit sustained decline in male attendance, whereas leks within unburned islands or >1.5 km away from fire perimeters tend to show stable or increasing trends. Analyses of postfire habitat composition further revealed that sagebrush vegetation height within 0.8 km around leks, as well elevation within 0.8 km, 6.4 km, and 18 km around leks, had a positive effect on male attendance trends. Moreover, the proportion of the landscape with cheatgrass (Bromus tectorum) cover >8% had negative effects on male attendance trends within 0.8 km, 6.4 km, and 18 km of leks, respectively. Synthesis and applications. Our results indicate that maintaining areas of unburned vegetation within and outside fire perimeters may be crucial for sustaining sage‐grouse populations following wildfire. The role of unburned islands as fire refugia requires more attention in wildlife management and conservation planning because their creation, protection, and maintenance may positively affect wildlife population dynamics in fire‐prone ecosystems.