Small meshed G‐minnow traps were used to assess the habitat associations of juvenile shortfinned eels in Lake Waahi, a shallow mesotrophic lake in the lower Waikato River basin, New Zealand. Five distinctive marginal habitats (raupo, aquatic macrophyte, reed, willow, exposed clay, and mud), and five offshore positions at various depths through the water column and distances from the margin (1–3 m and 50–500 m, respectively) were compared. Eels smaller than 400 mm were closely associated with marginal habitat. The highest catch per unit effort (CPUE) of juveniles occurred in raupo, the most complex cover. CPUE in marginal habitats declined in autumn particularly in the willows which corresponded to defoliation. Offshore sampling revealed that eels smaller than 350 mm were almost exclusively in the margins, and that larger eels were mostly offshore. Beyond 50 m from the margin, the size of eel did not change with increasing distance offshore. Eels were not caught in suspended traps (other fish were), suggesting that eels in this lake were benthic foragers. Reasons for juvenile habitat selectivity are discussed and management implications highlighted.