Nest site selection in birds is expected to represent a trade-off between a suitable microclimate for thermoregulation and visual protection against predators or social disturbance. In this study, I examine the influence of different characteristics of the nesting habitat on breeding success, predation, and the nesting behaviours of Little Penguins (Eudyptula minor) in South Australia to help understand potential fitness benefits, costs or trade-offs associated with nesting habitat selection. I found that neither predation nor vigilance were influenced by the characteristics of the nest. However, nest type was an important factor for both breeding success and thermoregulation: birds nesting in rock nests had the highest hatching and breeding success, while individuals nesting in artificial nests engaged more in maintenance behaviours, suggesting that thermoregulation demands may be the most important factors for nest site selection in Little Penguins.