We present a detailed case study of conservation and restoration of the Australian arboreal marsupial Leadbeater's Possum (Gymnobelideus leadbeateri) and its Mountain Ash forest habitat to illustrate the important intersection between forest restoration principles and the general principles for forest biodiversity conservation. Mountain Ash forests have been extensively modified through a century of intensive logging, recurrent wildfires and post-fire salvage logging. These disturbances have led to a reduction in old growth forest to 1/30th-1 /60th of the extent of historical levels, a rapid collapse followed by a prolonged (>30-year) shortage of populations of hollow-bearing trees throughout the Mountain Ash forests (which are critical habitat elements for many species of cavity-dependent vertebrates), and an increased risk of re-burning of landscapes dominated by young, regrowth forest The consequences of the severe decline and consequent 'temporary extinction' of large old trees will be the potential global extinction of Leadbeater's Possum whose distribution is significantly associated with the number of large old trees. We outline the conservation and forest restoration principles and practices that are needed to address these problems. We discuss how general principles for forest restoration must be multi-faceted and multi-scaled by encompassing strategies ranging from retaining existing key residual elements of original natural forest cover (e.g. remaining populations of target species, key structures, habitats, and patches) through to restoring patterns of forest cover and key ecosystem processes. We also outline how forest restoration principles intersect strongly with similarly multi-faceted and multiscaled general principles for forest biodiversity conservation - in particular, those corresponding to conserving populations of particular species and their habitats, maintaining stand structural complexity, maintaining patterns of landscape heterogeneity, and perpetuating key ecosystem processes. Finally, we outline the potential for positive cumulative benefits of multiple restoration and conservation strategies by outlining how actions at one scale can create benefits at other (smaller or larger) scales.