The Rufous-tailed Antthrush is distributed in south-east Brazil from Espírito Santo to Rio Grande do Sul and into Argentina.  It is found in the Atlantic Rain Forest and forest edges especially where there is dense undergrowth and it is usually at between 1,000 and 2,200 metres so is at higher elevations than Short-tailed Antthrush C. campanisona or Such's Antthrush C. meruloides.

Apart from the altitudinal and geographical distribution it is difficult to separate from other members of the genus except by voice.

There are recordings on xeno-canto, a distribution map from NatureServe and additional information available via Avibase. There is also a page with excellent photos on Wikiaves.