We performed an allozyme survey of genetic differentiation in Pinus balfouriana, a subalpine conifer endemic to California that is comprised of two allopatric subspecies, one in the Klamath Mountains and the other in the southern Sierra Nevada. Although the two subspecies are morphologically distinct and gene flow between them is virtually nonexistent, we observed much higher levels of differentiation among populations within a subspecies than between the two subspecies. Differentiation is particularly strong in the Klamath populations (multilocus FST = 0.242), which are small, isolated, and ecologically marginal. We attribute this strong differentiation to the mountain island effect, in which populations restricted to high elevations become isolated from each other on different mountains separated by unsuitable intervening habitat, with consequent reduced gene flow allowing populations to evolve independently. Populations of P. balfouriana in the Klamath region only exist scattered on the few highest ridges and peaks that rise above 2,000 m, which defines the lower limit of the species elevational distribution. This pattern of distribution has allowed genetic drift and allelic sorting through historical events to produce strong population-level differentiation, which was likely in place before the two subspecies were geographically separated. Because P. balfouriana occurs on both serpentine soils and nonserpentine soils in the Klamath Mountains, we tested for genetic differentiation between populations growing on serpentine versus nonserpentine soils and our results were equivocal. Our data, combined with several other studies of conifers, show that the mountain island effect can produce significant genetic differentiation in conifers whose life-history traits of widely dispersed pollen, long generation times, and high outcrossing rates would lead us to predict a more homogenous population genetic structure.