[5] Chromis limbata occurs in the Azores and Madeira which are part of Portugal and in the Canary Islands, Spain.

It has also been reported off the coast of western Africa from Senegal to Pointe Noire, Congo.

Small numbers of C. limbata have been recorded off islands in Santa Catarina in southern Brazil and these may be vagrants or may have been introduced through discharge of ships' ballast water.

[6][1] The adults of Chromis limbata occur in rocky reefs and sandy-weedy areas, with a depth range of 5–45 metres (16–148 ft).

[1] Chromis limbata is a valued food fish in Madeira and is subject to a small scale artisanal fishery, especially off the south and east of the island.