Within the Neotropical genus Sporophila, a group of eight species known colloquially as “southern capuchinos” shows remarkable phenotypic variation despite lack of (species level) mitochondrial DNA monophyly and extremely low differentiation in other putatively neutral genetic markers. Previous studies have interpreted this as reflecting recent common ancestry and, perhaps, ongoing hybridization and introgression. A recent taxonomic revision of the only polytypic southern capuchino species, Sporophila bouvreuil (with four previously recognized subspecies), prompted the designation of S. bouvreuil and S. pileata as two distinct species on the basis of plumage color and geographic distribution. We used DNA sequence and microsatellite data to corroborate these new species designations and explored for the first time the relationship between these taxa and the remaining southern capuchinos. Phylogenetic and population genetic analyses showed that S. bouvreuil and not S. minuta, as was previously thought, is the sister species to the core radiation of which S. pileata is part. Our data suggest that the ancestor of the southern capuchinos is derived from northern South America and began to radiate during the lower to middle Pleistocene into at least eight species within the grasslands of northeastern Argentina, eastern Paraguay, and southern Brazil. Consistent with earlier studies, we could not distinguish among southern capuchino species using neutral genetic markers, an expected signature of a rapid and recent radiation.