It is native to central and northern Europe where it grows on moist acidic soils, moorland, grassy heathland and the drier parts of marshes.

[2][4] This species can be distinguished from marsh lousewort (Pedicularis palustris) by being smaller and less erect and having two small teeth at the tip of the upper lip rather than four.

Typical habitats include moorland, wet flushes in mountainous areas, grassy heathland, lakesides and the drier parts of marshes and bogs.

[3] The origin of the common name is that there was a belief in times past that livestock that ate this plant would acquire lice as a consequence.

[5] Like other members of the genus, common lousewort is semi-parasitic, supplementing its own resources by connecting its roots to those of nearby plants and extracting water and nutrients for its own use.