 "Eucalyptus nicholii" was first formally described in 1929 by Joseph Maiden and William Blakely in Maiden's book, "A Critical Revision of the genus Eucalyptus".The specific epithet honours Maiden's private secretary and "Chief Clerk, Botanic Gardens", Richard Nicol.The narrow-leaved black peppermint grows in shallow, relatively infertile soils overlying shale and slate bedrock usually as part of grassy or sclerophyll woodlands, in association with "Eucalyptus andrewsii" and "Eucalyptus caliginosa".