Toothed whales produce echolocation clicks with source parameters related to body size; however, it may be equally important to consider the influence of habitat, as suggested by studies on echolocating bats. A few toothed whale species have fully adapted to river systems, where sonar operation is likely to result in higher clutter and reverberation levels than those experienced by most toothed whales at sea because of the shallow water and dense vegetation. To test the hypothesis that habitat shapes the evolution of toothed whale biosonar parameters by promoting simpler auditory scenes to interpret in acoustically complex habitats, echolocation clicks of wild Amazon river dolphins were recorded using a vertical seven-hydrophone array. We identified 404 on-axis biosonar clicks having a mean SL_pp of 190.3±6.1 dB re. 1 μPa, mean SL_EFD of 132.1±6.0 dB re. 1 μPa²s, mean Fc of 101.2±10.5 kHz, mean BWRMS of 29.3±4.3 kHz and mean ICI of 35.1±17.9 ms. Piston fit modelling resulted in an estimated half-power beamwidth of 10.2 deg (95% CI: 9.6–10.5 deg) and directivity index of 25.2 dB (95% CI: 24.9– 25.7 dB). These results support the hypothesis that river-dwelling toothed whales operate their biosonars at lower amplitude and higher sampling rates than similar-sized marine species without sacrificing high directivity, in order to provide high update rates in acoustically complex habitats and simplify auditory scenes through reduced clutter and reverberation levels. We conclude that habitat, along with body size, is an important evolutionary driver of source parameters in toothed whale biosonars.