Proteus anguinus lives in the subterranean fresh water biotopes of the Dinaric Karst, from the Isonzo-Soca River in south-eastern Venezia Guilia, Italy through the southern half of Slovenia, southern Croatia, and parts of Bosnia and Herzegovina to the Trebisnjica River in eastern Herzegovina (Sket 1997). It has been introduced in the Parolini Grotto, Vicenza, northern Italy and Tular near Kranj in Slovenia. It may occur in Montenegro but this has not yet been confirmed (Kalezic and Dzukic 2001). The variant known as the black olm (formerly described as the subspecies Proteus anguinus parkelj; see Comments) is found in Bela Krajina, southeast Slovenia (Stet and Arntzen 1994; Griffiths 1996).

This species prefers underground water systems in karst formations, with calm, usually well-oxygenated water and a constant low water temperature between 8ºC (winter) and 11ºC (in one locality rarely up to 14ºC in summer) (Sket 1997; Honnegger 1981). It occurs in caves and may also be found in abandoned mines, from close to the surface to depths as much as 300 m underground, depending on how thick the karst formation is (Stuart et al. 2008). During periods of high rainfall and flooding it may be found in cave entrances (Stuart et al. 2008). The variant known as the black olm can be found in warmer surface waters (Stuart et al. 2008).