C. echinella is a common liverwort found growing on various substrates in wet forest to rainforest. This species was once known under the genus Chiloscyphus as C. echinellus. In the literature, Cyanolophocolea is segregated from Chiloscyphus by having blue oil bodies. This feature however, doesn't seem develop well in Tasmanian specimens.

C. echinella is otherwise separated from the similar looking Chiloscyphus muricatus by having clearly toothed leaf margins.