Extensive livestock ranching is one of the main drivers of habitat degradation in terrestrial communities in the dry Chaco forest (Argentina). Grazing intensity could differentially affect native mammals and their interactions, which could impact both, native mammal communities and livestock production systems. Here, we determined how the activity index of grey foxes Lycalopex gymnocercus and capture abundance and richness of small mammals vary along a grazing intensity gradient in a particular region of the dry Chaco forest (Copo National Park, Argentina). Track plots were used to estimate the activity index of foxes and cattle, and Sherman traps for small mammals. Fresh scats were collected to analyse the diet of foxes and to assess possible changes in predator-prey dynamics. Fruit availability and shrub density were measured in 6 plots of 2 m × 50 m. We used generalized linear mixed models, Spearman’s nonparametric rank correlation, Chi-squared test, and Spearman’s partial correlation coefficient to analyse the potential effects of grazing intensity. We found that the activity index of foxes increased (0.06 ± 0.018) while small mammal abundance (-0.08 ± 0.024) and species richness decreased (rs = -0.94) with increasing grazing intensity. However, the proportion of scats with mammalian remains decreased with increasing grazing intensity. Also, we did not find a strong partial correlation between foxes and small mammals when we controlled for grazing intensity. This suggests that the abundance and diversity of small mammals in the study area are determined more by grazing intensity than by predator-prey interactions. Grazing intensity could negatively affect small mammals, but not through changes in fruit availability or shrub density, but possibly by affecting grass cover. Consequently, foxes’ activity could increase to meet caloric intake requirements. Our results suggest that specific cattle management recommendations depend on the wildlife species that serves as a conservation target. We recommend testing whether reducing cattle load can make this productive activity compatible with wildlife conservation in dry Chaco forests.