Capercaillie live in mature conifer forests, with a preference for Scots pine. Such large birds require lots of habitat and each male, bird being strongly territorial, needs up to 100 hectares of forest.  Hen territories are smaller than those of the cocks, but can still occupy an area as large as 40 hectares.  Although the males are zealously territorial with regards to other males encroaching on their "patch", the territory of males and females can and often overlaps. 

Adult Capercaillie are herbivorous, but chicks eat large amounts of insects, particularly caterpillars, ants, ground beetles and spiders during the first five weeks of life, seeking this food independently. Open, mature pine forest with plenty of blaeberry is the best, and most important, habitat for Capercaillie. Blaeberry plants are a very important source of the caterpillars needed by chicks (there is a specialised butterfly species whose caterpillars develop only on Vaccinium myrtillus); the leaves and berries are also an important food source for Capercaillie.

To support a Capercaillie population it is important that there is a range of forest structures with plenty of blaeberry but also some partially open areas preferred for lekking, boggy areas which support plants and insects which are an important source of food and areas of younger or more dense trees which provide shelter and cover, particularly over winter.