Crustose Coralline Algae (CCA) is a well-known settlement inducer for stony corals and, ultimately, recruitment, a vital component for reef growth and resilience. However, potential impacts of diseased CCA on larval settlement are not fully understood, especially on particular coral species. As oceans continue to warm, coral larvae need to be able to respond to settlement cues in elevated temperatures, yet the combined effects of thermal stress and CCA health status on larval behavior is not well known for most coral species. Here we assessed the effect of elevated temperatures and disease on the ability of the CCA Hydrolithon boergesenii to induce settlement of Diploria labyrinthiformis larvae. D. labyrinthiformis planulae were exposed to 4 substrate combinations (healthy CCA, diseased CCA, bare substratum, and bare tissue culture plate) and three temperatures (27.5°C, 29°C, and 31°C). Overall, settlement started earlier and was 1.5-3x higher at 31°C, regardless of CCA health status, but at this temperature, larval mortality increased two-fold in diseased CCA. Settlement differences between healthy and diseased H. boergesenii were only observed at 29°C, with healthy CCA facilitating twice as much settlement and having 3x lower mortality than diseased. Our findings suggest that, even though larvae can settle in both healthy and diseased CCA, temperature plays an important role in whether larvae will settle or perish. This study highlights the importance of healthy CCA to maintain and increase settlement and the ability of larvae to adapt to a warming ocean, contributing to the knowledge of D. labyrinthiformis larval ecology, valuable for larval rearing for restoration purposes.