Grassland patches occurring in complex rainforest-woodland dominated landscapes provide important habitat to numerous fauna species, and the ecotones between grasslands and rainforests may contain higher biodiversity than either single ecological community. Different fire regimes result in different ecotone gradients between grassland and surrounding rainforest. Little is known about how insectivorous microbats use these rainforest-grassland ecotones. This study aimed to determine the preference of microbats for abrupt or gradual gradient ecotones, and for distance from the edge of the ecotones. This study was conducted in Cape York Peninsula, Australia, an area of high biodiversity that is facing many emerging Anthropocene threats including changing fire regimes, weed infestation, and the effects of climate change. Bat activity was determined using bat detectors placed along linear transects across five ‘gradual’, and five ‘abrupt’ ecotones. Overall bat activity and the activity of three bat guilds (open, edge/open and closed) was compared between ecotone types, and position along the ecotone. It was found that mean total bat activity, open guild and edge/open guild bat activity was significantly higher at grassland and ecotone edge positions than at rainforest positions. For closed guild bats, activity was significantly higher at gradual ecotone sites than at abrupt ecotones sites. It is likely that these findings were attributable to the structural differences associated with the ecotone types and positions, but may also have been driven by insect prey availability. The findings from this study can be used directly by land managers to develop conservative management plans, particularly for future fire regimes.