Food resources are linked to habitat characteristics and are one of the most important forces which constrain avian life histories. Availability of food affects avian body condition and strongly determines avian breeding performance. For many small passerines in the Northern Hemisphere, lepidopteran larvae (caterpillars) and arachnids are crucial dietary components during the rearing stage, but scarce information is available for Neotropical regions. In this study, we evaluated the relationship between the food delivery rates to the nestlings of caterpillars and arachnids and the tree-canopy cover and proportion of exotic trees of the nesting habitat of the insectivorous Masked Gnatcatcher Polioptila dumicola. In addition, as caterpillars and arachnids are high-quality prey-items for nestlings, we also evaluated whether differences in food delivery rates of these two prey-items were associated with nestlings' growth rates. We videotaped 23 nests in native forests of central-east Argentina during 2015–2018 breeding seasons. Both caterpillars and arachnids deliveries were positively associated with tree-canopy cover at the nest surroundings. Percentage of exotic tree-canopy cover in the nest surroundings was low (mean 8.18%), and was not associated with the frequency of food delivery. The proportion of arachnids delivered was positively associated with the asymptotic values of body mass and with the nestling tarsus maximum growth rate. Our results confirm that food resources are influenced by the tree-canopy cover in the nest surroundings, suggesting that less tree-covered patches of forests may contribute to a general decrease in the amount of food. We conclude that differences in nestling diet between habitats with different degree of tree cover contribute to explaining variance in the breeding performance of this species. Due to the alarming degree of alteration of these forests in recent decades, we highlight the importance of preserving forest portions with a high tree-cover that ensure better nestling growth in austral Masked Gnatcatcher's populations.