[2] Located in the Zona Sur, they inhabit both Futahuillimapu ("great land of the south")[2] and, as the Cunco or Veliche[3][4] subgroup, the northern half of Chiloé Island.

A genetic study showed significant affinities between Huilliches and indigenous peoples east of the Andes, which suggests but does not prove a partial origin in present-day Argentina.

[8] The main modern areas of Huilliche settlement are two; San Juan de la Costa west of Osorno and Compu-Chadmo in the southeast of Chiloé Island.

[2][16] The portion of Futahuillimapu south of Maipué River became largely depopulated following a period of pillaging by the Spanish and loyalist Huilliches that had relocated from Osorno to the forts of Carelmapu and Calbuco.

[2] In late 18th century Basque navigator José de Moraleda wrote that Huilliches of Osorno were more stocky, agile and of general better appearance than the people of Chiloé.

[23] Sociedad Stuttgart, a society established in the 19th century to bring German settlers to Chile, purchased about 15 000 km2 under fraudulent conditions from Huilliches in the Precordillera east of Osorno.