Hooded Parrots share with Golden-shouldered Parrots the unusual habit of nesting in termite mounds so the ranges of both these parrots are limited by the occurrence of suitable termite mounds - in both cases they only use the tall mounds known as Magnetic or Cathedral termite mounds.

Hooded Parrots occur only in the Northern Territory and they range from Larrimah north to near the South Alligator River and east to Ramingining. They were first discovered in 1898 near the town of Pine Creek and that is still one of the best places to see them today. Small groups or even flocks are quite frequently seen in the town parks, especially in hot weather when they are seeking water.

Nest holes are usually between one and two metres from the ground and sometimes they are occupied for successive seasons - presumably the higher ones would afford better protection from predatory goannas. The four or five white eggs are layed after the wet season, between January and April, so that the fledglings emerge in the dry season to coincide with the seeding of grasses.