A tropical population of rufous-collared sparrows Zonotrichia capensis with year-round territoriality and breeding, included about 50% nonterritorial floaters. These floaters (the underworld) did not wander randomly; they lived in well-defined restricted home ranges within other birds'' territories. Female home ranges were usually single territories; male ranges, usually 3-4 territories. Since range limits of both sexes coincide with territory boundaries, the net effect is 2 unique single-sex dominance hierarchies of floaters for each territory. When an owner dies, it is nearly always replaced very quickly by the dominant local underworld bird of the appropriate sex. An underworld system could evolve wherever membership will increase a floater''s chances to breed and where the costs to the owner of having floaters in its territory are less than the costs of driving them out; this in turn depends on how local breeding numbers are limited. Such a social organization of floaters may be a widespread strategy in a variety of territorial species.