Daykundi Province was carved out of the northern part of Uruzgan Province in 2004, becoming a separate province. It falls into the traditionally ethnic Hazara region known as the Hazarajat and the provincial capital is Nili. It is surrounded by Bamyan Province in the northeast, Ghazni Province in the southeast, Uruzgan Province in the south, Helmand Province in the southwest, and Ghor Province in the northwest.