In the wild, the orbicular batfish is found in brackish or marine waters, usually around reefs, at depths from 5 to 30 meters. Its range extends from the Red Sea and East Africa in the east to the Tuamotu Islands in French Polynesia in the west, and from southern Japan in the north to northern Australia and New Caledonia.
It has been recorded off the coast of Florida, though this may be the result of dumping of aquarium specimens. Juvenile fish are solitary or live in small groups, among mangroves or other inner sheltered lagoons. Adults are found in more open waters and at greater depth.