Arid grasslands worldwide are transitioning to scrublands due to shrub encroachment, resulting in habitats with varying shrub cover. Shrubs play a crucial role in grassland ecosystems, offering trade-offs to rodents in terms of visibility, shelter, and food availability, thereby affecting their occurrence and distribution. This study explores the link between habitat characteristics and rodent activity and density, focusing on shrub presence. In the Tirunelveli district of southern India, we measured rodent density and activity across three grassland types with increasing shrub presence. Our findings reveal species- pecific responses to shrub density. The Soft-furred rat (Millardia meltada) dominated, showing adaptability to different shrub levels, while the black rat (Rattus Rattus) was least represented. Fine-scale analysis indicates a positive association between shrub presence and rodent captures. Grassland obligate species like the Indian gerbil (Tatera indica) exhibited reduced activity in densely shrubbed sites, whereas semi-arboreal species like the Indian palm squirrel (Funumbulus palmarum) showed increased activity. This study underscores the importance of considering habitat structure in grassland ecosystem management for the conservation of rodent diversity and ecosystem health.