Bay-headed Tanagers occur on both slopes in Costa Rica (north to the Cordillera de Tilarán; Stiles and Skutch 1989) and in western Panama. The distriubution extends south along the Pacific coast of Colombia and Ecuador to extreme northwestern Peru (Tumbes; Wiedenfeld et al. 1985). Also found on both slopes of all three Andean ranges in Colombia; from the eastern Andes of Colombia, the range extends south to central Bolivia. Occurs as well in northern Colombia in the Santa Marta mountains, in the Andes of Venezuela, and in the coastal cordilleras of Venezuela east to Trinidad. In the lowlands east of the Andes, is found from southeastern Venezuela and adjacent northern Brazil east across the Guianas to Amapá, Brazil (Novaes 1978).
Also occurs in the lowlands east of the Andes from southeastern Colombia south at least to southeastern Peru, and east into Brazil, both north and south of the Amazon.
The elevational distribution is from the lowlands up to 1800 meters (Parker et al. 1996), but some subspecies have more restricted elevational distributions (Isler and Isler 1999).
The Bay-headed Tanager is resident in most of its range, but some populations move about seasonally. In Costa Rica, they move downslope to 100 meter or less on the Caribbean side in response to the late rainy season (Stiles and Skutch 1989). In Panama, the species moved out of a study area during the dry season (Karr 1977).
The distribution of the Bay-headed Tanager includes the following zoogeographic regions: Northern and Southern Amazonia, the Central and Northern Andes, the Chiriquí Darién Highlands of Panama, the Choco Lowlands of Colombia and Tepuis of Venezuela (Parker et al. 1996).