The effects of climate fluctuations on seasonally dry forests and their fauna are important to a holistic understanding of diversification in the South American lowlands. We document the intraspecific genetic structure of the burnished-buff tanager (Tangara cayana), a species common in seasonally dry tropical forests throughout South America. Using both mitochondrial sequence and nuclear microsatellite markers, we present an intraspecific phylogeny, haplotype network, and a STRUCTURE analysis. We also develop environmental niche models and project them onto two alternate paleoclimate models of the Last Glacial Maximum and mid-Holocene. Paleoclimate projections indicate a much greater extent and connectivity of suitable T. cayana habitat during the Last Glacial Maximum (LGM), decreasing through the mid-Holocene toward the present. Both microsatellite and mtDNA sequence data are consistent with a clockwise route of colonization for the current circum-Amazonian distribution of T. cayana. The species likely originated in the Cerrado of Brazil and expanded westward through Bolivia, across the seasonally dry forests at the base of the Andes, and into Guyana and northern Brazil. Northeastern populations then expanded south into coastal Pernambuco, Brazil completing the current ring-like distribution of this species.