Although domestic animal transmission of rabies has largely been mitigated, the disease remains a concern in both Europe and North America where wildlife transmission has caused epizootics. Raccoon (Procyon lotor) rabies was established in Alabama, USA, in 1975, primarily in the southeastern corner of the state. However, with the exception of isolated events, rabies has not continued to spread westward across the Alabama River. We monitored movements of 100 radiocollared raccoons on 2 sites within hardwood and agriculture habitats in a rabies enzootic area east of the Alabama River, in managed pine habitat area west of the river where rabies sporadically occurs, and in a mixed pine hardwood area outside of the known rabies enzootic area to determine if raccoon movements and habitat use in certain habitat types and the presence of a river may serve as natural barriers preventing the western spread of rabies in Alabama. We also examined raccoon contact rates to determine if they influence disease transmission through static and dynamic interactions. Raccoons in mixed pine–hardwood forest habitats had smaller home ranges and less overlap of ranges compared to the other 3 habitats. However, static interactions between habitats in the use of overlap areas did not differ (F_11,129 = 1.63, P = 0.09). Rabies antibody titers were highest in the managed pine habitat (28%) even prior to oral vaccine bait distributions in spring of 2004 and 2005. Biomarker data from radiocollared and additional raccoons captured after the bait distribution west of the Alabama River demonstrated a low efficacy of the vaccine reaching the small southern raccoons. The combination of the river as a partial barrier, the high percentage of pine forested habitat west of the river, and limited spatial movements of raccoons within these forested habitats appears to have reduced the likelihood of rabies establishing west of the river. Understanding different host–habitat–disease systems is important for successful management of diseases. Based on our results, we recommend that the oral vaccine program continue to use the Alabama River as a partial barrier and baiting be concentrated in the fragmented bottomland hardwood forests and around larger bodies of water where raccoon densities are highest. Success of baiting strategies designed to take advantage of northern raccoon dynamics and habitat use may not be applicable to southern populations.