[3] It has been isolated from a wide range of habitats, including cultivated and uncultivated soils, forests, grassland, deserts, estuarine sediments and sewage sludge, and insects.

[4][5] P. lilacinum has shown promising results for use as a biocontrol agent to control the growth of destructive root-knot nematodes.

Species fungorum and GBIF currently list: P. lilacinum was previously considered to be monotypic and was classified with the Fungi Imperfecti or Deuteromycetes, fungi for which perfect (i.e., sexually reproducing) states have rarely been found.

"Paecilomyces lilacinus" was classified in the section Isarioidea, for which perfect states had not been found.

Many isolates of P. lilacinum have been identified from around the world and it is accepted that variation exists within the species.