Features of the nest cavity, nest tree, and surrounding vegetation have variously been shown to be important in nest site selection by cavity-nesting birds, yet few investigators have simultaneously considered these three habitat components. During 1995 and 1996 we considered each component in a study of nest site selection by Elf Owls (Micrathene whitneyi) in the Sonoran Desert. All Elf Owl nests (n = 68) were located in saguaros (Carnegiea gigantea) with a density of 0.032 nest saguaros/ha. At the scale of the nesting area, the number of cavities in a saguaro was the most important variable influencing whether it was selected for nesting; each additional cavity in a saguaro increased the odds it was selected by a factor of 4.4. Increasing the density of mature saguaros also increased the odds that an area was selected. At the scale of the nest saguaro, nest cavities were located in the main stem in greater proportion than their availability and were located higher above ground than random cavities. Nest cavities also were nonrandomly oriented toward the north, suggesting that cavity microclimate may influence nest site selection. Only 20–25% of potential nest cavities were occupied by cavity nesting birds, suggesting that habitat was not saturated. The differences between Elf Owl nest sites and potential nest sites at both the scale of the nesting area and nest saguaro suggest the presence of sufficient cavities to enable owls to occupy preferred sites within the study area.