Seaweed meadows are a significant feature of tropical coastlines, yet these habitats are only just beginning to be recognised as key parts of tropical marine ecosystems. While recent research has revealed that numerous reef-associated fishes may be dependent on seaweed meadows at some stages of their life history, we are yet to understand the extent to which these fishes specialise towards a seaweed existence, and the traits that may be associated with this type of habitat specialisation. For my Honours research, I studied the MacropharyngodonÂ-Xenojulis phylogroup of wrasses to explore the extent to which closely-related reef fishes may specialise, and therefore, depend upon coral and/or seaweed habitats. Using a combination of published and new data, I found that this related group of species had a distinct affiliation with either seaweed or corals. Although there was some overlap apparent at the mesohabitat scale, microhabitat preferences revealed strong ecological segregation via the association of each species with either hard corals (Macropharyngodon) or canopy-forming seaweeds (Xenojulis). Moreover, foraging and dietary preferences also differed according to microhabitat, with Macropharyngodon generally consuming more foraminifera from sand-pavement microhabitats, while Xenojulis gleaned their diverse epibiont prey from canopy-forming seaweeds. Our findings suggest the potential for strong microhabitat specialisation and dependency on both seaweed and coral habitats, which means these should be conserved and managed as equally important components of tropical marine ecosystems.