It is found in Asia, Africa, Melanesia, Australia, New Zealand, and South, Central, and North America.

The lichen was originally described as a variety of Cladonia fimbriata by Finnish lichenologist Edvard August Vainio in 1894.

The type specimen, collected in 1885, was found in Minas Gerais, Brazil, in the Caraça Mountains, at an elevation of 1,400 m (4,600 ft).

The podetia are whitish, measuring 1–2 cm (0.4–0.8 in) long, abundantly brown, rarely branched, acute or forming, tiny cups, with small scales, especially at the base.

Cladonia subradiata grows in primary montane rainforests, preferring substrates such as humus and boulders.