Gouldian finches form long-term, monogamous pairs, which live within the social structure of larger flocks. Unlike most other finches, Gouldian finches build loosely constructed grass nests inside tree hollows, and several pairs may share one hollow. During the breeding season, the female lays one egg per day for about five days, which both sexes take turns incubating. The chicks hatch after 12 days and remain in the nest for another 21 days until they make their first flight; they then stay with their parents for several months after they have fledged.
For most of the year, Gouldian finches feed on grass seeds. During the breeding season, their diet switches to almost entirely insects, because they are rich in protein and help satisfy the demanding appetite of the chicks. As with most other grassfinch species, the Gouldian finch is seldom found far from water, since it needs to drink several times during the day. They live in tropical and coastal areas of north and northwestern Australia.