Coolbaggie Nature Reserve supports communities of narrow leafed ironbark and white cypress on poor sandy soils and black cypress on silt stones. congoo mallee and green mallee predominate in the mallee areas. Pilliga grey box, which has a geographically restricted distribution, is also present in a small area.

The Nature Reserve contains a disjunct population of congoo mallee. It was originally declared to conserve a malleefowl population, in conjunction with the much larger area of Goonoo State Forest.

Three bird species are recorded at their north eastern limit: the endangered Gilbert's whistler, the yellow rumped pardalote and the yellow tailed honey eater.

Coolbaggie Nature Reserve is managed to conserve the Mallee habitats and their fauna, which requires keeping intervention to a minimum. The reserve is available for environmental monitoring and scientific research.