The northern rosella is found across northern Australia.

In Western Australia, it
is found across the Kimberley south to the 18th parallel, around Derby, Windjana
Gorge National Park, the northern Wunaamin Miliwundi Ranges, Springvale Station and
Warmun, with vagrants reported at Halls Creek and Fitzroy Crossing. In the Northern
Territory it is found from Victoria River north to the Tiwi Islands and east into
western Arnhem Land, and across northern Arnhem Land through Milingimbi Island and
the Wessel Islands to the Gove Peninsula. It is absent from central Arnhem Land,
but is found further east around the western and southern coastline of the Gulf of
Carpentaria, south to Borroloola and across the border into western Queensland[21]
as far as the Nicholson River.[22]

The northern rosella lives in grassy open forests and woodlands, including
deciduous eucalypt savanna woodlands. Typical trees include species of Eucalyptus,
[18] such as Darwin stringybark (Eucalyptus tetrodonta),[15] Melaleuca, Callitris
and Acacia. More specific habitats include vegetation along small creeks and
gorges, sandstone outcrops and escarpments, as well as some forested offshore
islands. The northern rosella is occasionally found in mangroves or public green
spaces in suburban Darwin. It avoids dense forest.[18]