The sandstone false antechinus was discovered in 1948 when it was collected on the American-Australian expedition to Arnhem Land.

[3] It was described in 1954, when it was given the species name bilarni, which reflects the Aboriginal pronunciation of Bill Harney, an Australian writer and naturalist who accompanied the expedition.

[4] The sandstone false antechinus is partly diurnal and differs from the other members of its genus in its very long, narrow muzzle and its more greyish colour.

[4] The sandstone false antechinus is found in rocky areas around the Top End and the Gulf of Carpentaria in the Northern Territory.

It also inhabits coastal rock platforms on Marchinbar Island.