Genetic diversity is the raw foundation for evolutionary potential. When genetic diversity is significantly reduced, the risk of extinction is heightened considerably. The long-snouted seahorse (Hippocampus guttulatus) is one of two seahorse species occurring in the North-East Atlantic. The population living in the Ria Formosa (South Portugal) declined dramatically between 2001 and 2008, prompting fears of greatly reduced genetic diversity and reduced effective population size, hallmarks of a genetic bottleneck. This study tests these hypotheses using samples from eight microsatellite loci taken from 2001 and 2013, on either side of the 2008 decline. The data suggest that the population has not lost its genetic diversity, and a genetic bottleneck was not detectable. However, overall relatedness increased between 2001 to 2013, leading to questions of future inbreeding. The effective population size has seemingly increased close to the threshold necessary for the population to retain its evolutionary potential, but whether these results have been affected by sample size is not clear. Several explanations are discussed for these unexpected results, such as gene flow, local decline due to dispersal to other areas of the Ria Formosa, and the potential that the duration of the demographic decline too short to record changes in the genetic diversity. Given the results presented here and recent evidence of a second population decline, the precise estimation of both gene flow and effective population size via more extensive genetic screening will be critical to effective population management.