Delayed natal dispersal occurs in many tropical and southern temperate species. In these species, juveniles remain with their parents on natal territories for periods beyond the age of nutritional independence, in contrast to juveniles of northern temperate species, in which prompt dispersal is more typical. Despite its prominence in the life history of tropical and southern temperate birds and its importance in setting the stage for prolonged social interactions among kin, detailed knowledge about delayed dispersal in most species that inhabit these regions is lacking. We describe patterns of delayed dispersal, territory acquisition, and natal dispersal distances in a Neotropical species, the Buff-breasted Wren (Thryothorus leucotis). Male and female juveniles were both philopatric to natal territories and delayed dispersal for an average of 10 months after fledging. Most juveniles were no longer present on natal territories when their parents began to breed the following year, so opportunities for cooperative breeding were rare. Juveniles that stayed longer on natal territories were more likely to recruit into the local breeding population than individuals that dispersed earlier, and approximately two-thirds of juveniles that acquired territories within the study area shared at least one territorial boundary with kin. By remaining on natal territories for prolonged periods and acquiring territories near their parents, juvenile Buff-breasted Wrens may avoid potential costs associated with floating and may benefit from extended opportunities to interact with kin.