Poppy by Avi, illustrations by Brian Floca

From the back of the book:
It is scary to look Mr. Ocax in the eyes. Especially if you are a deer mouse and only six inches long (and three inches of that is your tail). Besides, if you are Poppy you would rather be dancing in the moonlight. Instead, you have to defend yourself against the tyranny of Mr. Ocax, a great horned owl, who, compared to you, is huge.
Mr. Ocax has declared himself king of Dimwood Forest, claiming that he alone protects the mice from porcupines. In order to expand beyond Gray House (where they have lived since the farmer left), the mouse family must ask Mr. Ocax's consent. He refuses, saying that Poppy and her boyfriend did not request permission for a little dancing on Bannock Hill. That moment begins all the trouble.
Frightening trouble, as it turns out, for Poppy must come face-to-face with a dreaded porcupine and, equally alone, confront Mr. Ocax at his most fierce. It's then that Poppy learns that there is no bully worse than a bully whose bluff is called.