Conservationists on Anglesey say they are "delighted" because steps to prevent the spread of a deadly red squirrel virus seem to have worked.
Scientist feared the virus would badly affect red squirrel numbers
In December last year a wild red squirrel at Newborough forest died after contacting "squirrel pox".
Scientists implemented an emergency plan, including removing all grey squirrels - which carry the virus - and disinfection of nest and feeding boxes.
It is hoped squirrel numbers will now grow to around 80 later in the summer.
The Newborough red squirrels were released into the forest in 2004 and 2005, with animals coming from zoos and captive breeding collections across the UK.
The virus is spread from grey squirrels, which are more resistant to the illness, to red squirrels to whom it proves fatal.
Previous outbreaks in Lancashire and in Cumbria led to a "catastrophic collapse of local red squirrel populations", said Dr Craig Shuttleworth, woodland ecologist at Menter Môn, which run the Anglesey red squirrel project.
Following monitoring however, 40 red squirrels were discovered at Newborough with the anticipation that the population will now grow to around 80 later in the summer.
"The discovery of so many red squirrels in Newborough forest was a real surprise," said Dr Shuttleworth.
"We had anticipated that the virus may have killed a large proportion of the resident squirrels and were getting ready for some disappointing results from the trapping work."
Finding so many red squirrels was a "huge boost", he said, and means the forest is now one of the most important red squirrel habitats in Wales.
"it is home to a thriving squirrel population," he added.