Bog hair-cap moss is often found in Sphagnum bogs, wet tundra, muskeg, sedge meadows, and sometimes on wood in wet spruce forests. This species is most commonly noted forming very dense hummocks, with individual plants tightly bound together by white to brown wooly hairs called tomentum. Mosses in the genus Polytrichum have semi-vascularized stems, allowing them to grow taller than many other mosses. Its overall appearance is bristly, looking like a bottlebrush or conifer seedling. Plants have a single stem, 6-12 cm tall, with 2-5 mm long leaves held out in all directions (especially when wet). The leaves are narrow-lanceolate. Leaf margins are folded over, creating a long line along the center of the leaf (look with a handlens). The center line is one key character separating it from other members of the genus (i.e., Polytrichum commune). However, the center line is also present in the mineral soil-loving Polytrichum juniperinum, but that species lacks the dense mat of white tomentum. Plants often have reproductive structures, either a stalked capsule with a hairy cap (female) or a brown cup-like structure at the tip of the plant (male).

Plants are dioecious—male and female reproductive structures produced on separate plants. Frequently fertile, the female capsules release spores into the wind to establish new plants.

Widespread in the boreal regions, and found southward in relict bog habitats.