The species occurs primarily in lowland forest, but can adapt to secondary growth and mixed cultivation with trees (Allen 2020). 

Otus fuliginosus is endemic to the Philippines where it is known from Palawan and the adjacent island of Balabac, with an unconfirmed report from Calauit (Collar et al. 1999). The location of the island of 'Alabagin', mentioned in Collar et al. (1999) as being occupied by this species on account of a single specimen, is entirely obscure. On Palawan, there are records from Kinalaykayan and Dicabaitot, St Paul's Subterranean River National Park, Cleopatra's Needle, Buenavista, Iwahig Penal Colony, the vicinity of Puerto Princesa, Quezon at Tabon, Singnapan at Kabasakan, Pinikpikan and Tining-luan, Taguso, Mt Mantalingajan at Pinigisan and Tigwayan, Batarasa. Although described as rare and evidently a bird of lowland forest, the emerging evidence from knowledge of its voice is that it is much more common and more widespread than was supposed.

Conservation Actions Underway
No species-specific actions are known, but the species has been recorded from St Paul's Subterranean River National Park. It is listed in CITES Appendix II.

Conservation Actions Proposed
Protect areas of lowland forest within the species' range. Enforce restrictions on agricultural encroachment and logging within such protected areas. Generate density estimates to inform a revised population estimate for the species.