The Mediterranean Basin is a global hotspot of biodiversity. Hotspots are said to be experiencing a major loss of habitat, but an added risk could be the decline of some species having a special role in ecological relationships of the system. We reviewed the role of European rabbits (Oryctolagus cuniculus) as a keystone species in the Iberian Peninsula portion of the Mediterranean hotspot. Rabbits conspicuously alter plant species composition and vegetation structure through grazing and seed dispersal, which creates open areas and preserves plant species diversity. Moreover, rabbit latrines have a demonstrable effect on soil fertility and plant growth and provide new feeding resources for many invertebrate species. Rabbit burrows provide nest sites and shelter for vertebrates and invertebrates. In addition, rabbits serve as prey for a number of predators, including the critically endangered Iberian lynx (Lynx pardinus) and Spanish Imperial Eagle (Aquila adalberti). Thus, the Mediterranean ecosystem of the Iberian Peninsula should be termed "the rabbit's ecosystem." To our knowledge, this is the first empirical support for existence of a multifunctional keystone species in a global hotspot of biodiversity. Rabbit populations have declined drastically on the Iberian Peninsula, with potential cascading effects and serious ecological and economic consequences. From this perspective, rabbit recovery is one of the biggest challenges for conservation of the Mediterranean Basin hotspot.