"Underground" won the Palme d'Or (Golden Palm) award at the 1995 Cannes Film Festival, considered the festival's highest honor. It was director Emir Kusturica's second such award after "When Father Was Away on Business". "Underground" was selected as the Serbian entry for the Best Foreign Language Film at the 68th Academy Awards, but was not accepted as a nominee. "Underground" also nominated for Best Foreign Film at the 13th Independent Spirit Awards nearly 3 years after the film won Palme d'Or, but lost to "The Sweet Hereafter".