Sustainable groundwater management is based on hydrogeological information that is usually nonexistent, outdated, or incomplete in developing countries like Honduras. Such is the case of the Siguatepeque aquifer where adequate management strategies are not implemented, jeopardizing the sustainability of the aquifer, which is currently the most important source for water supply. This study determines the hydrogeological units and water balances of the aquifer as a basis for groundwater management. The aquifer limits and a conceptual model were defined, and hydrogeological parameters were compiled based on previous studies. For the first time, a complete well inventory was registered and mapped. Static levels were measured in 25 wells and, based on previous data, it was possible to perform a historical analysis. Recharge was calculated through a soil water balance and extraction was estimated based on 105 monitored wells. Based on hydrogeological conditions, the aquifer (228 km2) is classified as semiconfined with intermediate to low yield for groundwater supply. Average recharge was calculated as 10.7 million m3/year (47.1 mm/year). Wells (506) were registered in the inventory and the average extraction was estimated as 4.5 million m3/year, representing 41.7% of average recharge. Analysis of historical data shows a decrease of groundwater levels especially in the urban area, where almost 80% of the wells are located. In this area, extraction exceeds recharge by 93%. Considering the aquifer’s hydrogeological characteristics and dynamics, and its current utilization regime, the urban area may be facing overexploitation and counter measures should be implemented to avoid further aquifer depletion.