Although there are a few exceptions, parrots are monogamous breeders which nest in cavities and hold no territories other than their nesting sites. The pair bonds of the parrots and cockatoos are strong and the pair will remain close even during the non-breeding season, even if they join larger flocks.

As with many birds pair bond formation is preceded by courtship displays; these are relatively simple in the case of cockatoos.

In Psittacidae parrots common breeding displays, usually undertaken by the male, include slow deliberate steps known as a "parade" or "stately walk" and the "eye-blaze", where the pupil of the eye constricts to reveal the edge of the iris.

Allopreening is used by the pair to help maintain the bond. Cooperative breeding, where birds other than the breeding pair help the pair raise the young and is common in some bird families, is extremely rare in parrots, and has only unambiguously been demonstrated in the Golden Parakeet (which may also exhibit polyamorous or group breeding system with multiple females contributing to the clutch).


Only the Monk Parakeet and five species of Agapornis lovebird build nests in trees, and three Australian and New Zealand ground parrots nest on the ground.

All other parrots and cockatoos nest in cavities, either tree hollows or cavities dug into cliffs, banks or the ground. The use of holes in cliffs is more common in the Americas. many species will use termite nests, possibly as it reduces the conspicuousness of the nesting site or because it creates favourable microclimates.

In most cases both species will participate in the nest excavation. The length of the burrow varies with species, but is usually between 0.5–2 m in length. The nests of cockatoos are often lined with sticks, wood chips and other plant material. In the larger species of parrot and cockatoo the availability of nesting holes can be limited and this can lead to intense competition for them both within the species and between species, as well as with other bird families.

The intensity of this competition can limit breeding success in some cases. Some species are colonial, with the Burrowing Parrot nesting in colonies up to 70,000 strong. Coloniality is not as common in parrots as might be expected, possibly because most species adopt old cavities rather that excavate their own.