AbstractThe Bag‐shelter moth, Ochrogaster lunifer (Lepidoptera: Notodontidae), is an Australian endemic species of Thaumetopoeinae with a univoltine life cycle and gregarious, herbivorous larvae. It is variable throughout its range across the continent, most noticeably by the species of host tree used and nest‐building behaviour. It has long been considered a species complex by some taxonomists, and the lack of gene flow between populations of ground‐nesters and above‐ground nesters at the same sites provides strong evidence for at least two species. We tested the specificity of host use and nesting behaviour of ground‐nesting and trunk‐nesting forms of O. lunifer by transplanting field‐collected egg masses to the other form's host, either in their natural position or in the position used by the other form. At the study site, ground‐nesting and trunk‐nesting (tree‐hugger) O. lunifer coexist. Ground‐nesting larvae are found on Acacia spp., and egg masses are laid at the base of host tree trunks where nests develop whereas tree‐hugger larvae are found on Blakella tessellaris, egg masses are laid in the outer canopy, and nests develop on the trunk or large branches. Of the 47 egg masses of O. lunifer transplanted to the unnatural host, only one cohort of tree‐hugger larvae developed through to adult moths. Placing an egg mass in its unnatural position on its natural host did not prevent the larvae from developing and successfully establishing nests for either nesting‐form, although all the ground‐nesters moved position (from the canopy to the ground) and the tree‐huggers mostly did not (from the ground to the canopy). Only the tree‐hugger form of O. lunifer developed a viable nest on the unnatural host species, established a nest at the unnatural oviposition site, and shared that nest with larvae of the other nesting‐form, suggesting tree‐hugger larvae are somewhat plastic in their behaviour and ecology. Our findings add to previous studies indicating that Acacia is likely the ancestral host of O. lunifer though large areas of its range remain unstudied.