Animal species are seldom distributed evenly at either local or larger spatial scales, and instead tend to aggregate in sites that meet their resource requirements and maximise fitness. This tendency is likely to be especially marked in arid regions where species could be expected to concentrate at resource-rich oases. In this study, we first test the hypothesis that productive riparian sites in arid Australia support higher vertebrate diversity than other desert habitats, and then elucidate the habitats selected by different species. We addressed the first aim by examining the diversity and composition of vertebrate assemblages inhabiting the Field River and adjacent sand dunes in the Simpson Desert, western Queensland, over a period of two and a half years. The second aim was addressed by examining species composition in riparian and sand dune habitats in dry and wet years. Vertebrate species richness was estimated to be highest (54 species) in the riverine habitats and lowest on the surrounding dune habitats (45 species). The riverine habitats had different species pools compared to the dune habitats. Several species, including the agamid Gowidon longirostris and tree frog Litoria rubella, inhabited the riverine habitats exclusively, while others such as the skinks Ctenotus ariadnae and C. dux were captured only in the dune habitats. The results suggest that, on a local scale, diversity is higher along riparian corridors and that riparian woodland is important for tree-dependent species. Further, the distribution of some species, such as Mus musculus, may be governed by environmental variables (e.g. soil moisture) associated with riparian corridors that are not available in the surrounding desert environment. We conclude that inland river systems may be often of high conservation value, and that management should be initiated where possible to alleviate threats to their continued functioning.