The Welsh Assembly has said a cull of around 4,000 sheep on the Brecon Beacons will begin on Friday.
The action was announced after blood tests on thousands of animals roaming free on the mid Wales national park confirmed traces of foot-and-mouth disease.
Thousands of sheep face slaughter
Farming leaders in Powys said they were worried about whether flocks on the hills can ever be successfully re-stocked.
The news of the mass slaughter comes on the same day Welsh Assembly Rural Affairs Minister Carwyn Jones and First Minister Rhodri Morgan announced a �65m rural recovery plan for the worst hit parts of the country.
Mass testing - which the Department for Environment, Food and Rural Affairs began on the weekend - was ordered after outbreaks were found at Libanus in the Beacons.
There were particularly high levels of foot-and-mouth antibodies in one of the five flocks of hefted animals - those which learn from and adapt to their environment over generations. Around 10,000 sheep roam the mountain.
Farming leaders said confirmation the disease had spread onto the hills came as a "devastating blow".
Crisis in Wales
Total confirmed cases UK-wide 1,888 - with 109 in Wales
Powys - 68 cases
Anglesey - 13 cases
Monmouthshire - 20 cases
Rhondda Cynon Taff - 1
Neath Port Talbot -1
Newport - 3
The positive test results were returned in the week the cancelled Royal Welsh Show was due to take place and fears over the future of agriculture and the tourism industry have now intensified.
Carwyn Jones said the cull was unplesant but vital to try to stop the spread of foot-and-mouth.
"We are well aware that the loss of these hefted flocks will have serious environmental consequences for the Brecon Beacons," he said.
Meanwhile, the Farmers' Union of Wales said tourism and rural businesses would continue to suffer despite the announcement of a rescue package.
Businesses in the nine hardest hit local authorities will get �9m, while �4.2m will go toward tourism marketing and �10m toward environmental projects. Money will also help re-stock farms.
In a letter to Carwyn Jones, Brecon Beacons National Park chairman Brian Powdrill said vaccination would be a better solution than a cull.
He said: "We are facing a disaster that is rapidly turning into a tragedy.
"The disappearance of hefted flocks will have a disastrous effect on traditional land management in the area and wide ranging social and economic effects on the farming community."
But concerns in Wales continue to mount as as Prime Minister Tony Blair travels to Cumbria - another area badly affected by foot-and-mouth - to deliver an upbeat message.
He will tell tourist operators the worst of the disease is over and the government was doing all it can to help the industry.
Farmers in Cumbria, who have lost over 1.5m animals to farm culls, said the cull of 4,000 could be the start of a 100,000-strong slaughter in Wales.
They are awaiting test results from their own hefted flocks in the Lake District and said any remaining threat to livestock was a huge concern.