Defining phenotypically similar populations as separate cryptic species can provide insights into the speciation process, as the taxa in question are often in the early stages of speciation. Here, we identify potential cryptic species based on a comprehensive dataset of COI mitochondrial DNA barcodes from 2,333 individual Panamanian birds across 429 species, representing 391 (59%) of the 659 resident landbird species of the country, as well as opportunistically sampled waterbirds. We complement this dataset with additional publicly available mitochondrial loci, such as ND2 and cytochrome b, obtained from whole mitochondrial genomes from 20 taxa. Using barcode identification numbers (BINs), we find putative cryptic species in 19% of landbird species, highlighting hidden diversity in the relatively well-described avifauna of Panama. Whereas some of these mitochondrial divergence corresponded with recognized geographic features that likely isolated populations, such as the Cordillera Central, the majority (74%) of lowland splits were between eastern and western populations. The timing of these events did not coincide across taxa, suggesting that historical events, such as the formation of the Isthmus of Panama and Pleistocene climatic cycles, were not the primary drivers of speciation. Rather, we observed that forest species, understory species, insectivores, and strongly territorial species- all traits associated with lower dispersal ability- were all more likely to have multiple BINs in Panama, suggesting strong ecological associations with divergences. Additionally, hand-wing index, a proxy for dispersal capability, was significantly lower in species with multiple BINs. These results suggest that dispersal ability plays an important role in generating diversity in Neotropical birds. Together, these results underscore the need for evolutionary studies of tropical bird communities to consider ecological factors along with geographic explanations, and that even in areas with well-known avifauna, avian diversity may be substantially underestimated.