Background Languages differ greatly both in their syntactic and morphological systems and in the social environments in which they exist. We challenge the view that language grammars are unrelated to social environments in which they are learned and used. Methodology/Principal Findings We conducted a statistical analysis of >2,000 languages using a combination of demographic sources and the World Atlas of Language Structures— a database of structural language properties. We found strong relationships between linguistic factors related to morphological complexity, and demographic/socio-historical factors such as the number of language users, geographic spread, and degree of language contact. The analyses suggest that languages spoken by large groups have simpler inflectional morphology than languages spoken by smaller groups as measured on a variety of factors such as case systems and complexity of conjugations. Additionally, languages spoken by large groups are much more likely to use lexical strategies in place of inflectional morphology to encode evidentiality, negation, aspect, and possession. Our findings indicate that just as biological organisms are shaped by ecological niches, language structures appear to adapt to the environment (niche) in which they are being learned and used. As adults learn a language, features that are difficult for them to acquire, are less likely to be passed on to subsequent learners. Languages used for communication in large groups that include adult learners appear to have been subjected to such selection. Conversely, the morphological complexity common to languages used in small groups increases redundancy which may facilitate language learning by infants. Conclusions/Significance We hypothesize that language structures are subjected to different evolutionary pressures in different social environments. Just as biological organisms are shaped by ecological niches, language structures appear to adapt to the environment (niche) in which they are being learned and used. The proposed Linguistic Niche Hypothesis has implications for answering the broad question of why languages differ in the way they do and makes empirical predictions regarding language acquisition capacities of children versus adults.