The Wallacea biogeographic region of Sulawesi, the Moluccas and Lesser Sunda is globally renowned for exceptional endemism, but is currently emerging as a development frontier in Indonesia. We assessed patterns and drivers of forest loss and fragmentation across the region, and used dynamic deforestation models to project future deforestation to 2053. Up to 10 231 km2 was deforested between 2000 and 2018, and a further 49 570 km2 is expected to be lost by 2053, with annual deforestation rates ranging between 0.09% and 2.17% in different sub-regions (average: 1.23%). Key biodiversity areas (priority sites for endemic and threatened biodiversity) are particularly vulnerable to deforestation if they are small, coastal and unprotected. Sub-regional variation in deforestation patterns and drivers must be acknowledged if conservation interventions are to be targeted and effective. We provide a valuable baseline from which to monitor Wallacea's new development course, as Indonesia undergoes profound policy changes that will provide both challenges and opportunities for environmental governance and conservation