© 2015 The Fisheries Society of the British Isles. This study used a network of acoustic receivers deployed around a no-take zone in Mangrove Bay, within the Ningaloo Reef Marine Park in Western Australia, to study residency and habitat preference of a small coastal shark, the nervous shark Carcharhinus cautus. Twelve C. cautus were tagged with acoustic tags and monitored for up to 579days. Based on individuals detected within the receiver array for at least 2months, C. cautus had small core (50% kernel utilization distribution, KUD) and home ranges (95% KUD) of 0·66 and 3·64km2, respectively, and showed a strong habitat preference for mangroves, which are only found in the no-take zone. This resulted in C. cautus spending most of their detected time within the no-take zone boundaries (mean=81·5%), showing that such a protected area could be beneficial to protect this species from extensive fishing pressure and local depletion, where required. Not all C. cautus remained within the acoustic array, however, suggesting that individual variations occur and that not all individuals would benefit from such protection. This study provides important information about the habitat, residency and movements of C. cautus that can be used for management and conservation. The strong affinity and residency of C. cautus within a mangrove-fringing coastline, emphasizes the importance of mangrove habitat to the species and suggests that such preferences can be used to design appropriate no-take zones for this species or others with similar habitat preferences.