Populations of large ungulates are dwindling worldwide. This is especially so for wild sheep, which compete with livestock for forage, are disturbed by shepherds and their dogs, and are exposed to disease transmissions from livestock. Our aim was to assess spatial patterns in realized niche overlap between wild and domestic sheep to better understand where potential competition might arise, and thus to identify priority areas for wild sheep recovery. Location: Southern Caucasus (220,000 km2).We studied Gmelin’s mouflon (Ovis orientalis gmelinii), an ancestor of domestic sheep, to investigate seasonal habitat use and niche overlap with domestic sheep. To map habitat, we analysed mouflon occurrences collected during 2006–2016, and domestic sheep occurrences from shepherd camp locations digitized on high-resolution satellite imagery. We mapped areas of potential competition between mouflon and domestic sheep and assessed potential habitat displacement. Mouflon and domestic sheep niches overlapped substantially (overlap index I = 0.89, where 1 means perfect overlap) but were not identical. Mouflon habitat was less widespread than domestic sheep habitat (14,000 vs. 40,270 km2) and tended to be located in more rugged areas with less vegetation cover. We identified 51 priority patches as reintroduction candidates if grazing pressure and poaching were reduced. Our results suggest that competition with domestic sheep might have pushed mouflon into marginal habitat. Thus, conservation efforts focusing on current mouflon habitat might miss suitable reintroduction sites. We demonstrate that a combined habitat model for wild and domestic sheep can identify general sheep habitat, which might be more useful for conservation planning than understanding current mouflon habitat selection. Our results highlight that considering competition with livestock is important for large ungulate conservation, both in terms of reactive (e.g., lessening livestock pressure in prime habitat) and proactive strategies (e.g., reintroduction in areas with low contemporary overlap).