Invasion blurs the biphasic mosaic, amplifies the 'wicked problem' through impacts on avian distributions in montane habitats.
Globally, managing invasive plants and habitat transformation often constitutes a wicked problem due to highly variable impacts on threatened biodiversity. In naturally patchy habitats, invasion can blur edges, pushing species beyond natural habitats. In biphasic habitats like forest-grassland mosaics, complementary sets of specialist species offer a unique configuration to examine such impacts from both directions. In the Shola Sky Islands, extensive woody invasive stands and agriculture/production landscapes have created a set of transformed closed and open habitats structurally similar to their natural counterparts. We expect the species usage of such novel habitats to reflect their dietary and habitat specialisation. We conducted 4,519 surveys across 1,204 randomly selected grid cells for the avian community, covering the global distribution of five species. For a select set of specialist and generalist species, we estimated patch occupancy and abundance using hierarchical models. We used acoustics to assess species persistence across invasion stages with automated recorders deployed across a year. We used community occurrence data to examine functional traits that correspond to habitat colonisation. Forest species occur year-round in transformed woody habitats across all invasion stages, and habitat overstory determines avian functional diversity. Forest specialists decline in transformed habitats across high-contrast edges, while generalists increase across both high- and low-contrast edges, indicating a supertramp strategy. Grassland specialist, however, decline strongly beyond all edges, creating a duality of losses and gains across the biphasic matrix. We highlight the diversity of threatened species responses to invasion and habitat transformation, underscoring the importance of nuanced approaches to habitat restoration, particularly in biphasic habitats.