Mangrove forests are among the world's most vulnerable subtropical and tropical habitats. With global losses already in excess of 50%, mangroves are being lost more rapidly than tropical rainforests. Those losses are critical to society because mangroves filter terrestrial contaminants, protecting coral reefs from eutrophication, sedimentation, and resulting degradation. Utila is a small island northeast of Honduras, well known for its diving opportunities. Anthropogenic development reduces the island's mangrove forests, threatening the health of surrounding coral reefs. We examined the effects of mangrove deforestation on coral reefs using shoreline mangrove density, near-shore nitrate levels, and algal coverage on adjacent reefs. These variables were measured offshore of both developed and undeveloped coasts. Mangrove density was significantly lower along the developed than the undeveloped coast (mean 0.27 stems/m² vs. 3.01 stems/m², respectively, p < 0.0001). Nitrate levels were significantly higher along the developed coast than along the undeveloped coast (mean 22.7 mg/L vs. 7.9 mg/L, respectively, p < 0.0001), as was algal cover (mean 48.1% vs. 32.4%, respectively, p < 0.0001). These results support arguments to reduce mangrove deforestation and encourage reforestation, which will protect not only mangroves and corals, but also avoid negative impacts to the local economy, which often is heavily reliant on dive tourism and fisheries.