Cladonia subsetacea has an area of occupancy less than 200 km2, and populations have been severely fragmented by agricultural and urban/suburban development. It is threatened by further loss of habitat and lack of natural disturbance regimes sustaining its required open sand microhabitat. Its asexual reproductive strategy probably strongly limits its dispersal to nearby habitat patches.Over the last 90 years, significant declines in area of occupancy and numbers of individuals are the result of habitat conversion, and remaining subpopulations are threatened by declines in quality of habitat due to fire suppression.

Cladonia subsetacea is a vagrant lichen, restricted to a very small area of occupancy in fossil sand dunes in the southeastern Coastal Plain of the USA. Across its range, subpopulations on these areas of relatively well-drained high ground have been fragmented by recent and ongoing intense pressure for urban/suburban and agricultural development, and a majority of remaining subpopulations suffer from declines in habitat quality because of a lack of natural fire disturbance.

Cladonia subsetacea is a vagrant lichen, restricted to well-drained, open-sand habitats in the southeastern Coastal Plain of the United States. The bulk of its known occurrences are in the fossil sand dune systems in Florida, and high pine habitats in North and South Carolina, with smaller numbers of occurrences in Georgia and a single historic colleciton from Alabama. The AOO is calculated at approximately 140 km2, with a high degree of confidence, as most of the white sand scrub sites are well-explored in the region.

This lichen can be locally abundant, but subpopulations are limited in spatial extent by the limited occurrence of open sand microhabitats within white sand scrub, and by the fragmentation and loss of naturally patchy scrub habitats due to urban and agricultural development. Very few open sand habitats remain undeveloped in the southeast Coastal Plain.

Cladonia subsetacea is a vagrant lichen, restricted to well-drained, open-sand habitats in the southeastern Coastal Plain of the United States.It is limited to the bare sand gaps between plants on extremely well-drained, nutrient poor sandy soils. These gaps are maintained by a combination of periodic fire, nutrient limitations, and potentially cryptogamic crusts, which limit the establishment of vascular plants. Fire return intervals are from 2-10 years in sandhills, and up to 100 or more years in rosemary scrub. Fire return intervals which are too long for each type of habitat result in the accumulation of litter, which has the dual effect of adding nutrients and covering bare sand soil. The nature of these soils means that they are extremely desirable for commercial citrus farming and urban/suburban development.

The habitat of this species is under intense pressure from development and subject to lack of proper management in the absence of natural fire regimes, allowing its required microhabitat of bare sand patches to be overgrown with vascular plants.