Bird communities in suburban habitats are dominated by generalist species and tend to have fewer specialist species sensitive to disturbance. Superb (Malurus cyaneus) and Variegated (M. lamberti) Fairy-wrens are morphologically and ecologically similar but differ in the degree to which they occupy suburban habitats. The species often occur in sympatry in natural habitats but in suburban habitats Superb Fairy-wrens are much more common than Variegated Fairy-wrens. We compared the characteristics of the habitat of both species in natural and suburban areas to investigate whether habitat requirements differed between the species, and which may explain observed patterns of abundance. Patch-level vegetative and disturbance-related habitat characteristics of territories were compared to those of non-territories in natural and suburban habitats. In natural habitats, Superb Fairy-wrens occupied more disturbed patches than Variegated Fairy-wrens. Vegetated drainages and patches of weedy remnant vegetation were important habitats for suburban Superb Fairy-wrens, which also tolerated the presence of humans whereas Variegated Fairy-wrens were particularly sensitive to human presence. A better understanding of the factors affecting the abundance of the more sensitive native species in suburban areas, such as Variegated Fairy-wrens, may inform conservation actions to enhance suburban biodiversity. © Royal Australasian Ornithologists Union 2011.