Habitat destruction and habitat fragmentation in natural areas are considered as a global threat against the protection of biodiversity. Development of roads throughrotectedareas and ecological sensitive regions cahavecatastrophiceffectowildlifeand leaves destructive impacts such as habitat fragmentation and isolation. Notwithstanding these negative ecological impacts, road networks continue to increase worldwide due to increasing socio-economic needs for high mobility. In Iran, road construction in protected areas and national parks is expanding during the past decades. While major effort ca be made to prevent and mitigate the negative impact of traortation infrastructure project o nature, it i obviou that such impact ca never be fully avoided. As a result environmental compensation has been discussed for loss of ecological value and to reach a more sustainable development. In this study, environmental compensation principle has been used in order to reduce ecological impacts of Isfahan’s west freeway, which passes through Ghamishloo wildlife refuge, I.U.C.N category IV, in Isfahan Province. The two key affected species of the study area Goitered gazelle ( gazella subgutturosa subgutterosa ) and wild sheep ( Ovis orientalis isfahanica ) were considered for compensation analysis. In order to replace new habitat area in the north part of Ghamishloo wild life refuge, the quality of habitat was evaluated. Habitat quality was measured as habitat suitability index for each species. By literature review and field observations, five effective variables including vegetation cover, slope, elevation, distance to water and distance to road were identified and the suitability maps was generated for each variable by assigning a suitability index (scale 0-1) to conditions for each variable. By including the equation for calculating the habitat suitability index (HSI), the final habitat suitability map for the study species were generated. Habitat unit (HU) was derived from multiplying the HSI for each of evaluation species by the habitat area (HU = HSI x size of habitat). Results showed 12565 habitat units (HUs) for Gazella subgutturosa subgutterosa and 16486 HUs for Ovis orientalis isfahanica will be gained by adding the proposed compensation area which will be considerable compared to lost habitat units in Ghamishloo wild life refuge due to road construction. In addition, in this study, Conditional Valuation Model and two dimensional questionnaires were used in order to determine economic habitat value of the study area and to measure people willingness to pay for habitat protection. Logit Regression Model was used and model parameters were estimated. Results showed that 78 percent of people in this study are willing to pay for the protection of the habitats of Ghamishloo wild life refuge. Average tendency of each person for annual payment for habitat value was 400,000 Rials and average tendency of each household was 145,600 Rials. According to the results of this study, the high protective value of the study area should be considered by policy makers and leads to their supports for planning compensation Keywords: Road , Environmental Compensation, Gazella subgutturosa, Ovis orientalis isfahanica, Habitat Suitability Index, Habitat Value, Conditional Valuation Model