It is found in Belize, Guatemala, Mexico, Nicaragua, and Panama.

Hylonycteris underwoodi feed on nectar, pollen grains, agave and fruits.

[2] This choice of food has allowed them to gain the ability of hovering flight, thereby evolving their body mass and size to compensate for the same.

[3] It was described as a new species in 1903 by British mammalogist Oldfield Thomas.

The holotype was collected by Cecil F. Underwood, who is the eponym for the species name "underwoodi".