Non-consumptive fear effects are an important determinant of foraging decisions by consumers across a range of ecosystems. However, how fear effects associated with the presence of predators interact with those associated with habitat structure remain unclear. Here, we used predator fish models (Plectropomus leopardus) and experimental patches of the macroalga Sargassum ilicifolium of varying densities to investigate how predator- and habitat-associated fear effects influence herbivory on coral reefs. We found the removal of macroalgal biomass (i.e. herbivory) was shaped by the interaction between predator- and habitat-associated fear effects. Rates of macroalgal removal declined with increasing macroalgal density, likely due to increased visual occlusion by denser macroalgae patches and reduced ability of herbivorous fishes to detect the predators. The presence of the predator model reduced herbivory within low macroalgal density plots, but not within medium- and high-density macroalgal plots. Our results suggest that fear effects due to predator presence were greatest at low macroalgal density, yet these effects were lost at higher densities possibly due to greater predation risk associated with habitat structure and/or the inability of herbivorous fishes to detect the predator model.