Historically it has been found along the Southern Atlantic coastal drainages from North Carolina to Florida, and west to Texas.

[3] Lepomis marginatus mainly feeds on detritus and filamentous algae as well as a few terrestrial insects (Homoptera, Hymenoptera[4][page needed]).

Historically, the dollar sunfish has been found along Southern Atlantic coastal drainages from North Carolina to Florida, and extending west to Texas.

The species is most common in the southeastern United States, becoming increasingly uncommon in the western part of its range [6][7] Its current range in North America is the Tar River in North Carolina to Brazos River in Texas in the USA; the former Mississippi Embayment in the US from western Kentucky and eastern Arkansas south to Gulf of Mexico.

However, due to its great similarity in appearance to younger specimens of the longear sunfish, L. megalotis, the distribution of L. marginatus has not been well understood in certain portions of its range.

Due to its small gape size it cannot open its mouth large enough to eat many of the smaller larvae fish swimming in its habitat.

McLane listed midge larvae and microcrustaceans as the major food items for dollar sunfish.

Stomachs of specimens from Tennessee contained much detritus and filamentous algae and a few terrestrial insects (Homoptera, Hymenoptera), probably indicating both benthic- and surface-oriented feeding behavior.

However, the eggs and larvae are at risk of predation from larger fish such as largemouth bass, other sunfish, and some invertebrates.

The micro-distribution of the dollar sunfish is characterized by a pH of 7 – 7.8, and a temperature of 16 – 28 degrees Celsius (61 – 82 degrees Fahrenheit)[11] They are often found in slow moving, small to large streams, floodplain pools, and oxbow lakes, ponds, and vegetated areas of large reservoirs.

The dams took away their natural habitat, but the dollar sunfish have adapted and can now be found in some reservoirs in West Tennessee and Florida.