The focus of this paper is bilingualism in Spanish and Nahuatl from the sixteenth century until the present day, with an exploration of its scope, functions and stability. We include a historical perspective to provide the necessary background for the contemporary context, which is approached with both qualitative and quantitative data acquired during fieldwork carried out in four different regions where Nahuatl and Spanish bilingualism is present today. Of special importance for the present study is the analysis of the results of proficiency assessment in both languages, performed with the participation of members of selected Nahua communities, which represent different degrees of assimilation to Mexican identity and shift to Spanish. We conclude that due to power differentials, economic, sociopolitical and cultural pressures and discriminatory language policies, contemporary Spanish-Indigenous bilingualism at the community level is unstable and transitional.