We present a method of targeted DNA sequence retrieval from DNA sources which are heavily degraded and contaminated with microbial DNA, as is typical of ancient bones. The method greatly reduces sample destruction and sequencing demands relative to direct PCR or shotgun sequencing approaches. We used this method to reconstruct the complete mitochondrial DNA (mtDNA) genomes of five Neandertals from across their geographic range. The mtDNA genetic diversity of the late Neandertals was approximately three times lower than that of contemporary modern humans. Together with analyses of mtDNA protein evolution, these data suggest that the long-term effective population size of Neandertals was smaller than that of modern humans and extant great apes.