 Lambertia formosa grows in heathland, mallee shrubland and dry sclerophyll forest, predominantly found on sandy or rocky soils. Associated heathland species include dwarf apple (Angophora hispida), paperbark teatree (Leptospermum trinervium), rusty banksia (Banksia oblongifolia) and heath banksia (Banksia ericifolia), while woodland trees include silvertop ash (Eucalyptus sieberi), smooth-barked apple (Angophora costata), narrow-leaved apple (A. bakeri), red bloodwood (Corymbia gummifera), yellow bloodwood (C. eximia), scribbly gum (Eucalyptus sclerophylla), and Sydney peppermint (E. piperita). One heathland community located between Lake Munmorah and Redhead grows at least partly on clayey soils. Here, L. formosa grows under mallee forms of brown stringybark (Eucalyptus capitellata) and broad-leaved white mahogany (E. umbra) and alongside shrubby forms of prickly-leaved paperbark (Melaleuca nodosa), dagger hakea (Hakea teretifolia), scrub she-oak (Allocasuarina distyla), rusty banksia and swathes of kangaroo grass (Themeda triandra).
