The decrease follows the removal of federal endangered species protections and the approval of wolf hunts in several Western states, the Los Angeles Times reported Tuesday.
Mike Jimenez, wolf management and science coordinator for the U.S. Fish and Wildlife Service, said "there's no surprise" in the reported decline. "The states are very carefully bringing the population down."
Biologists counted 1,674 gray wolves at the end of 2012 in Montana, Idaho, Wyoming, the eastern portions of Washington and Oregon, and north-central Utah, down from 1,804 the previous year.
When those populations were taken off the endangered species list, those states took over management of wolves within their boundaries and authorized hunts, the Times reported.
Wildlife advocates argue removing the wolves from protected status was premature and have criticized the hunts, but the wildlife service said the region's wolf population "is fully recovered."
"The wolf population may be stabilizing at some yet undetermined lower equilibrium," a report by the service said, adding if wolf numbers fall below a certain level the listing of gray wolves could be re-evaluated.