Fine-scale habitat selection of Chilean dolphins was studied between January and April 2002 through shore-based theodolite tracking in order to investigate the environmental and behavioural determinants of habitat use, and to evaluate the interactions between this species and aquaculture activities in Yaldad Bay, southern Chile. During 293.5 h of effort, movement and habitat selection patterns of dolphins exhibited a significantly concentrated use of only 21% of the entire study area. Correspondence analysis showed that shallow waters (5–10 m), proximity to coast and rivers were the most significant environmental parameters determining fine-scale dolphin distribution patterns, with foraging the most frequently observed activity. Aquaculture activities in the area were observed to affect dolphin habitat use patterns by restricting space available for biologically important dolphin behaviours.