Falco hypoleucos is threatened by the agricultural development of timbered plains (including pesticide use) and by the overgrazing of arid-zone rangelands. The taking of eggs by egg-collectors, and young for falconry is also a significant threat.
Falco hypoleucos is widely but very sparsely distributed in acacia scrub, spinifex and tussock grassland across Australia, where breeding records indicate that its range has shrunk in recent years and is now largely confined to areas within the 250 mm annual rainfall zone. Outside its main inland range reports are incidental and years apart.
The estimated population of Falco hypoleucos is put at less than 5,000 individuals. F. hypoleucos is considered "Vulnerable" by the IUCN Red List.