The usual habitat is open sclerophyll forest and woodland. It is more common where the understory is open and sparse or where the ground is covered with grass. Tree-holes are needed for nesting. It also occurs near wetlands and in partly cleared areas or farmland with trees along roads and fences. In urban areas it is found in parks and gardens. The range of the laughing kookaburra overlaps with that of the blue-winged kookaburra in an area of eastern Queensland that extends from the Cape York Peninsula south to near Brisbane. Around Cooktown the laughing kookaburra tends to favour areas near water while the blue-winged kookaburra keeps to drier habitats.