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Automated decision-making systems are increasingly deployed in domains such as hiring and credit approval where negative outcomes can have substantial ramifications for decision subjects. Thus, recent research has focused on providing explanations that help decision subjects understand the decision system and enable them to take actionable recourse to change their outcome. Popular counterfactual explanation techniques aim to achieve this by describing alterations to an instance that would transform a negative outcome to a positive one. Unfortunately, little user evaluation has been performed to assess which of the many counterfactual approaches best achieve this goal. In this work, we conduct a crowd-sourced between-subjects user study (N = 252) to examine the effects of counterfactual explanation type and presentation on lay decision subjects’ understandings of automated decision systems. We find that the region-based counterfactual type significantly increases objective understanding, subjective understanding, and response confidence as compared to the point-based type. We also find that counterfactual presentation significantly effects response time and moderates the effect of counterfactual type for response confidence, but not understanding. A qualitative analysis reveals how decision subjects interact with different explanation configurations and highlights unmet needs for explanation justification. Our results provide valuable insights and recommendations for the development of counterfactual explanation techniques towards achieving practical actionable recourse and empowering lay users to seek justice and opportunity in automated decision workflows.