The question of why animals choose particular habitats has important implications for understanding behavioral evolution and distribution of organisms in the wild and for delineating between habitats of different quality for conservation and management. Habitats chosen by animals can influence fitness outcomes via the costs (e.g., predation risk) and benefits (e.g., food availability) of habitat use. Habitat preferences should therefore be under selection to favor those that confer fitness advantages (Clark and Shutler 1999). Indeed, prevailing theory suggests that the habitat preferences of animals should be adaptive, such that fitness is higher in preferred habitats (Hildén 1965, Southwood 1977, Martin 1998). However, studies have often identified apparent mismatches between observed habitat preferences and fitness outcomes across a wide variety of taxa (Valladares and Lawton 1991, Mayhew 1997, Kolbe and Janzen 2002, Arlt and Pärt 2007, Mägi et al. 2009). Certainly, one limitation of studies may be that assessment of “fitness” is typically constrained to fitness surrogates such as nest success rather than lifetime reproductive success or classic Fisherian fitness (Endler 1986). Nevertheless, important habitat choices such as nest sites influence the probability that temporarily sedentary, dependent young are discovered by enemies such as predators and parasites. We therefore expect, on average, to see congruence between evolved habitat preferences and relevant components of fitness (e.g., nest success). Here, we (1) review the prevalence of apparent mismatches between avian breeding-habitat preferences and fitness outcomes using nest-site selection as a focus; (2) describe several potential mechanisms for such mismatches, including anthropogenic, methodological, and ecological–evolutionary; and (3) suggest a framework for understanding the contexts in which habitat preferences represent adaptive decisions, with a primary focus on ecological information theory. We largely focus on habitat selection as a behavioral process at the scale of individuals (e.g., Robertson and Hutto 2006), rather than at the scale of population-level patterns (Fretwell and Lucas 1970, Morris 2003, Johnson 2007). However, these two scales cannot be wholly divorced from one another, as we will discuss.