Understory (or understorey) is the term for the area of a forest which grows in the shade of the overstory or canopy. Plants in the understory consist of a mixture of seedlings and saplings of canopy trees together with understory shrubs and herbs. Young canopy trees often persist and suppressed juveniles for decades while they wait for an opening in the forest overstory which will enable their growth into the canopy. On the other hand, understory shrubs are able to complete their life cycle in the shade of the forest canopy.

Forest understories have lower light intensities. The wavelengths of light that are available are only a subset of those that are available in full sunlight. Understory plants must therefore be shade tolerant - they must be able to photosynthesise successfully with the limited amount of light that is available. They are often able to use wavelengths not available to canopy trees. In temperate deciduous forests understory seedlings "leaf out" before tha canopy trees do. This is important because it allows the understory plants a window in which to photosynthesise without the canopy present. This brief period (usually 1-2 weeks) is often a crucial period which allows the plant to maintain a net positive carbon balance over the course of the year.

Forest understories also have higher humidity than exposed areas. The forest canopy reduces solar radiation, so the ground does not heat up as rapidly. Consequently, the understory dries out more slowly than does more exposed areas. The greater humidity allows fungi and other decomposers to flourish. This drives nutrient cycling, and provides favourable microclimates for many animals and plants.