Relatively little is known about spatial turnover of marine benthic taxa in the diverse reef environments of Indonesia and how this is structured by environmental conditions. In the present study the community similarity of sponges was related to environmental and spatial variables. In total, 150 sponge species (N=15,842) were sampled within the Spermonde Archipelago in the Makassar Strait, off south-west Sulawesi. Ordination revealed that sponges are primarily structured by a complex interaction between depth, exposure and on-to-offshore variation in environmental variables. Together, environmental and spatial variables explained 56.9% of the variation in similarity of which 10.9% was due to environmental variables alone, 2.6% due to spatial variables alone and 43.4% due to covariation of environmental and spatial variables. The large amount of variation explained by the spatially structured environmental component is due to a strong on-to-offshore gradient in a number of environmental variables including temperature, velocity, salinity and suspended sediment load. Ordination was also used to identify associations between species and environmental variables.