Mostly found in subtropical and tropical waters of the Caribbean Sea, Gulf of Mexico, and southwestern Atlantic Ocean, E. emarginata ranges from Belize to Argentina. Common on the South America Atlantic coastline, they are one of the only extant echinoids found on the coast of Rio Grande do Sul (the other being Mellita quinquiesperforata) and the only one south of the La Plata river. Area inhibited by Encope emarginata is below the action of the normal wave regime, thus the fossils of this species is only truly disturbed during extreme coastal weather.
Encope emarginata inhabits sandy, muddy sediments of coastal waters. Although a marine species, they have also been found in estuaries and river mouths. The waters they live in are typically shallow, as deep as 20 meters.