The scarlet cup grows on decaying sticks in damp spots on forest floors, generally buried under leaf litter or in the soil. It is found between winter and spring.
Scarlet cup helps to decompose dead wood and recycle nutrients, supporting the growth of early spring plants. This mushroom is a food source for rodents and slugs.
The scarlet cup is said to be edible. However, its small size, tough texture and insubstantial fruiting do not make it particularly suitable for the table.