Reproduction is viviparous; once the developing embryos exhaust their supply of yolk, the yolk sac develops into a placental connection through which they receive nourishment from their mother. Mating is apparently an aggressive affair, as females are often found with biting scars and wounds on their sides. At the Fernando de Noronha Archipelago and Atol das Rocas off Brazil, parturition takes place at the end of the dry season from February to April, while at other locations in the Southern Hemisphere, females give birth during the Amazon summer in November and December. The average litter size is four to six, with a gestation period of one year. Females become pregnant every other year. The newborns measure no more than 74 cm (29 in) long; males mature sexually at 1.5–1.7 m (59–67 in) long and females at 2–3 m (79–118 in).
A profitable ecotourism industry has arisen around this species involving organized "shark feeds", in which groups of reef sharks are attracted to divers using bait. Some US$6,000,000 is spent annually on shark viewing in the Bahamas, where at some sites a single living Caribbean reef shark has a value between US$13,000 and US$40,000 (compared to a one-time value of US$50–60 for a dead shark). This practice has drawn controversy, as opponents argue that the sharks may learn to associate humans with food, increasing the chances of a shark attack, and that the removal of reef fishes for bait may damage the local ecosystem. Conversely, proponents maintain that shark feeds contribute to conservation by incentivizing the protection of sharks and educating people about them. Thus far, there has been little evidence that shark feeds have increased the risk of attack in the surrounding area. Shark feeding has been outlawed off the coast of Florida, but continues at other locations in the Caribbean.
Grey reef sharks are active at all times of the day, with activity levels peaking at night. At Rangiroa, groups of around 30 sharks spend the day together in a small part of their collective home range, dispersing at night into shallower water to forage for food. Their home range is about 0.8 km2 (0.31 sq mi). At Enewetak in the Marshall Islands, grey reef sharks from different parts of the reef exhibit different social and ranging behaviors. Sharks on the outer ocean reefs tend to be nomadic, swimming long distances along the reef, while those around lagoon reefs and underwater pinnacles stay within defined daytime and night-time home ranges. Where there are strong tidal currents, grey reef sharks move against the water: towards the shore with the ebbing tide and back out to sea with the rising tide. This may allow them to better detect the scent of their prey, or afford them the cover of turbid water in which to hunt.
The Caribbean reef shark feeds on a wide variety of reef-dwelling bony fishes and cephalopods, as well as some elasmobranchs such as eagle rays (Aetobatus narinari) and yellow stingrays (Urobatis jamaicensis). It is attracted to low-frequency sounds, which are indicative of struggling fish. In one observation of a 2 m (6.6 ft) long male Caribbean reef shark hunting a yellowtail snapper (Lutjanus crysurus), the shark languidly circled and made several seemingly "half-hearted" turns towards its prey, before suddenly accelerating and swinging its head sideways to capture the snapper at the corner of its jaws. Young sharks feed on small fishes, shrimps, and crabs. Caribbean reef sharks are capable of everting their stomachs, which likely serves to cleanse indigestible particles, parasites, and mucus from the stomach lining.