In Australia, the chestnut-breasted mannikin is known as a bird of reed beds and rank grasses bordering rivers, in swamp, in grassy country, and mangroves.

[4] John Gould wrote of it (quoted in Cayley, 1932):[5] I had not the good fourtune to meet with this bird in a state of nature, but I have been informed that it frequents reed beds bordering the banks of rivers and lagoons on the eastern coast, and that it much resembles the Bearded Tit Panurus biarmicus, of Europe in the alertness with which it passes up and down the upright stems of reeds, from the lower part to the very top, a habit for which the lengthened and curved form of its claws seem well adapted.In New Guinea, the chestnut-breasted mannikin is a bird of drier areas and does not usually seen in jungle roads and clearings where other munias such as grey-headed mannikin are found.

In Australia, during the breeding season chestnut-breasted mannikins are mostly seen in pairs, but in late autumn and winter months it congregates in large flocks, at times eating seeds of cereal crops.

Chestnut-breasted mannikin is a highly sociable species, flocking in large number outside the breeding season.

It has also been recorded that it feeds on feral millet Pannicum maximum and wild sugar cane Saccharum robustum in Papua New Guinea (Bapista 1990).