Eucalyptus globulus subsp. globulus occurs in tall open forest in south-eastern Tasmania and to a lesser extent along the eastern coast of the State. It also occurs on King and Flinders Islands in Bass Strait. Outside Tasmania it is confined to Wilson's Promontory and the Cape Otway district in southern Victoria. The climate throughout its range is cool to mild, with wet winters and reliable summer rainfall. Within parts of its range, light frosts and snowfalls occur.

Tasmanian Blue Gum is protected in conservation areas such as Maria Island National Park, Freycinet National Park, Tasman Arch Nature Reserve and St Mary's Pass Nature Reserve. Outside State reserves it occurs in reserves managed by the Department of Lands and the Forestry Commission. Both authorities have regulations prohibiting the taking of native flora from Crown Land and State forests respectively without prior permission of the managing authority.

Being a very tall evergreen tree Tasmanian Blue Gum is unsuitable for cultivation in the average home garden but it can be recommended as a handsome subject for parks and large gardens in regions which do not experience severe frosts. It is easily propagated from seeds. In subtropical horticulture it has enjoyed popularity as a bedding plant, with freshly raised seedlings being planted each year. Its horticultural value lies in the unusual effect achieved by the colour and form of the juvenile foliage. It is grown successfully in large gardens in Cornwall, where the cool to mild, damp climate is favourable.

The flowers are usually inaccessible and so they are seldom available for indoor decoration. The large blue-grey juvenile leaves are ideal as backing material in floral arrangements in which an unusual colour effect and bold form are desired. Either fresh or dried foliage may be used. Both emit the distinctive eucalyptus fragrance so evocative of the Australian bush.

Tasmanian Blue Gum yields pale, hard and durable timber which is used in Australia for poles, piles and sleepers. The species has been widely planted in New Zealand, South Africa, South America, California, India and Mediterranean countries, in farm windbreak, forestry and ornamental plantations. Among the qualities admired overseas are its rapidity of growth, straightness of trunk, strength of wood and adaptability to a range of sites. Originally overseas plantations supplied antiseptic oil, fuel, telegraph poles, mine props and construction timber. In addition they now provide pulpwood for paper and rayon manufacture. It has also contributed to the drainage of swamps in malarial localities in central Africa, Italy and Turkey. Before the role of the malarial mosquito in spreading the disease was understood, there was a superstitious belief that the leaves of the Blue Gum released a magical essence which purified the air of fever germs. In reality the benefit is derived from the loss of suitable breeding sites for mosquitoes, brought about by the capacity of the trees to evaporate water from the swampy ground.

Tasmanian Blue Gum is so abundant in coastal areas of California that many people assume it is a native species. In recent years concern has been expressed that it appears to be becoming naturalised. Studies show that there is a tendency for it to spread from plantations by seed dispersal along drainage lines but it is doubtful that it will ever become troublesome.