Sebastian's housing stock reflects its growth from fishing village to the county's largest city: a mix of older Florida-style homes, mid-century and later single-family houses, and newer subdivisions, along with waterfront properties on the lagoon and river. Many neighborhoods are within a short drive of boat ramps and waterfront parks. The market serves a blend of year-round residents and seasonal arrivals drawn to the coast, with a strong emphasis on outdoor and water-oriented living.

Sebastian is laid out along the Indian River Lagoon and the St. Sebastian River, with residential neighborhoods spread between the waterfront, U.S. 1, and Interstate 95. Waterfront and canal-front areas offer direct lagoon access, while inland neighborhoods provide more traditional Florida suburban living. The nearby communities of Roseland and Sebastian Highlands share services and identity with the city, and the riverfront and lagoon parks anchor the community's public spaces.

Life in Sebastian revolves around the water. Residents fish, kayak, and boat the Indian River Lagoon, surf and swim at the nearby Atlantic beaches and Sebastian Inlet, and birdwatch across the area's preserves. The city's fishing heritage is celebrated in local museums and events, and its outdoors-oriented, conservation-minded character distinguishes it from more developed coastal communities to the south. The pace is relaxed and decidedly Old Florida.

Sebastian is served by the School District of Indian River County, which operates elementary, middle, and high schools across the county, including campuses in and around Sebastian. The district's schools serve the city's growing population, with neighborhood assignments by address. Families also have access to private and parochial options in the Vero Beach and Sebastian area, and the countywide district connects Sebastian's students to a broad network of programs and facilities.

Sebastian sits along U.S. 1 on Florida's east coast, with Interstate 95 passing just west of the city and connecting it to Vero Beach, Melbourne, and points north and south. The city is roughly 14 miles north of Vero Beach and about an hour south of Cocoa Beach. As in much of coastal Florida, the automobile is the primary mode of travel, with local roads leading to the lagoon, riverfront, and beaches.

Outdoor recreation defines Sebastian. The Indian River Lagoon offers fishing, kayaking, and boating, while the St. Sebastian River Preserve State Park provides hiking, birding, and horseback riding across more than 20,000 acres of preserve. Pelican Island National Wildlife Refuge, the nation's first, lies across the lagoon, and Sebastian Inlet State Park and the Atlantic beaches are a short drive east. The Sebastian Fishing Museum and McLarty Treasure Museum add local history.