Communal nesting may be a consequence of a shortage of preferable nest sites (constraint hypothesis) or an adaptation generated by fitness benefits associated with egg aggregation (adaptive hypothesis). To test these hypotheses, we studied a lizard (Anolis sagrei) that often aggregates eggs in nest sites. In a lab study, females were given the option of nesting in (a) soil previously used as nest substrate vs. fresh soil and (b) soil with eggshells vs. without eggshells. We also experimentally examined the effects of egg aggregation by incubating eggs singly, in groups of four, and in groups of nine. Females were more likely to nest in pots with used soil and with eggshells than in pots with fresh soil or without eggshells. We observed no effects of egg aggregation on egg survival, egg temperature, or most measures of hatchling morphology. However, singly-incubated eggs absorbed more water than eggs incubated in the four and nine egg aggregations and this resulted in offspring with greater body condition at hatching. The behavioral experiment demonstrates that females actively choose nest sites that have been used previously (as expected under the adaptive hypothesis), but the egg aggregation experiment shows no benefits to offspring based on the variables measured. Thus, results of the behavior study support the adaptive hypothesis; however, results from our egg-incubation study do not. Likely, the adaptive and constraint hypotheses are not mutually exclusive, and a diversity of factors influence the evolution of communal nesting behavior.