Cantharellus decolorans is endemic to Madagascar. Ongoing deforestation is thought to be driving rapid declines in forest cover, and concomitantly driving rapid population declines in this species. An ongoing decline of at least 50% is suspected over three generations (50 years), and so C. decolorans is assessed as Endangered.

This species is known from Uapaca-dominated montane regions of the Central Highlands and eastern Madagascar, with records from east of Antananarivo south to Ranomafana National Park (see Buyck et al. 2015).

There is no quantitative information regarding the population size of this species. Ongoing threats to the species' habitat, however, are likely to be driving rapid declines. Within the mapped range of this species there has been extensive loss of forest cover in the past two decades. Since 2000 (up to 2019) the amount of forest cover at 30% canopy cover had declined by 30% (World Resources Institute 2021). Assuming that such forest loss may continue in the future, and extrapolating forward so that rates are looked at over the appropriate three generation time period (50 years; see Dahlberg and Mueller 2011), this would give a reduction of 75%. Translating such declines into population declines is difficult, but it would be precautionary to suspect that the species may be undergoing an ongoing decline of at least 50% over three generations.

It has been recorded from montane forest, dominated by Uapaca trees, with one record found growing inside a rotten Pandanus (Buyck et al. 2015).

Ongoing forest loss is likely to be having a significant impact on this species' habitat. The major drivers of this are land conversion for agriculture and logging.

This species has been recorded from the border of Ranomafana National Park, and near to Andasibe National Park, and so it is likely to occur in both. Identifying further areas that would be suitable for protection would be beneficial, not just for this species, but for the wider ecological community too. Research to see if the species may be more widespread would be beneficial, including confirming how may protected areas the species may occur in.