A plot of spin rate versus orientation when Hyperion is at the pericenter of its orbit (surface of section) reveals a large chaotic zone surrounding the synchronous spin-orbit state of Hyperion, if the satellite is assumed to be rotating about a principal axis which is normal to its orbit plane. This means that Hyperion's rotation in this zone exhibits large, essentially random variations on a short time scale. The chaotic zone is so large that it surrounds the 1/2 and 2 states, and libration in the 3/2 state is not possible. Stability analysis shows that for libration in the synchronous and 1/2 states, the orientation of the spin axis normal to the orbit plane is unstable, whereas rotation in the 2 state is attitude stable. Rotation in the chaotic zone is also attitude unstable. A small deviation of the principal axis from the orbit normal leads to motion through all angles in both the chaotic zone and the attitude unstable libration regions. Measures of the exponential rate of separation of nearby trajectories in phase space (Lyapunov characteristic exponents) for these three-dimensional motions indicate the the tumbling is chaotic and not just a regular motion through large angles. As tidal dissipation drives Hyperion's spin toward a nearly synchronous value, Hyperion necessarily enters the large chaotic zone. At this point Hyperion becomes attitude unstable and begins to tumble. Capture from the chaotic state into the synchronous or 1/2 state is impossible since they are also attitude unstable. The 3/2 state does not exist. Capture into the stable 2 state is possible, but improbable. It is expected that Hyperion will be found tumbling chaotically.