The yellow-bellied sheath-tailed bat appears to be wide-ranging, occurring across most parts of eastern and northern Australia, though in what densities remains uncertain due to the difficulties associated with capture and detection of the species. Much of the distribution understanding of this species has developed as a result of incidental sightings, such as one record from central western Queensland that was taken from a mummified bat found on a barbed-wire fence. Though most common throughout the tropical regions of their range, yellow-bellied sheath-tailed bats are known to occur regularly in semi-arid environments including the Mallee region of north-western Victoria, Gundabooka National Park in northwestern New South Wales, and central-western Queensland. This species likely migrates into its southerly range during summer, with seasonal records placing bats in most parts of Victoria, southwestern New South Wales, and the adjacent regions of South Australia.