Little Corellas are thought to pair for life and will start breeding at the start of a long period of rain. The nest site is a suitable tree hollow, lined with shavings of wood. This is normally used for several years in row. Both sexes incubate the eggs and both care for the young chicks. The chicks hatch naked and totally dependent on their parents.
Breeding pairs nest in large colonies, and several nests may be found in the same tree. Where their ranges overlap, different corella species may nest together, but they are not thought to breed with each other.