The Drab-breasted Bamboo-tyrant is found in south east Brazil and into north east Argentina. It inhabits humid forest and secondary growth where it forages in the undergrowth especially in bamboo patches.

It is dull olive above with a white eye-ring and prominent supraloral spot which gives rise to the Brazilian name of olho-falso or "false eye". The throat and breast are a dull grey while the belly is whiter.

When hawking for insects it seems to make a whirring noise with its wings.