Simple analytical models assuming homogeneous space have been used to examine the effects of habitat loss and fragmentation on metapopulation size. The models predict an extinction threshold, a critical amount of suitable habitat below which the metapopulation goes deterministically extinct. The consequences of non-random loss of habitat for species with localized dispersal have been studied mainly numerically. In this paper, we present two analytical approaches to the study of habitat loss and its metapopulation dynamic consequences incorporating spatial correlation in both metapopulation dynamics as well as in the pattern of habitat destruction. One approach is based on a measure called metapopulation capacity, given by the dominant eigenvalue of a ''landscape'' matrix, which encapsulates the effects of landscape structure on population extinctions and colonizations. The other approach is based on pair approximation. These models allow us to examine analytically the effects of spatial structure in habitat loss on the equilibrium metapopulation size and the threshold condition for persistence. In contrast to the pair approximation based approaches, the metapopulation capacity based approach allows us to consider species with long as well as short dispersal range and landscapes with spatial correlation at different scales. The two methods make dissimilar assumptions, but the broad conclusions concerning the consequences of spatial correlation in the landscape structure are the same. Our results show that increasing correlation in the spatial arrangement of the remaining habitat increases patch occupancy, that this increase is more evident for species with short-range than long-range dispersal, and that to be most beneficial for metapopulation size, the range of spatial correlation in landscape structure should be at least a few times greater than the dispersal range of the species.