Our unnamed hero on The Mandalorian came face-to-face (or, more accurately, helmet-to-helmet) with more of his kind in Friday's episode. We also learned an important bit of information about them: they live underground. It's still not entirely clear why Mandalorians stay underground, but we think we have a pretty good idea.
While there are still gaps in the lore of Mandalorians that we assume will get filled in bit by bit as the series continues, it seems safe to assume that their habit of hiding out underground comes from their dark times under the heavy fist of the Empire. This dates back to some of the storytelling that takes place in the spinoff animated TV shows, rather than in the movies. Here's what the official Star Wars website has to say about this period in Mandalorian history:
Once a glorious world, the surface of Mandalore was laid waste by war, leading Duchess Satine Kryze to renounce the planet's violent history and declare neutrality in the Clone Wars. Satine's pacifism was opposed by Death Watch, an underground movement of armored warriors that celebrated Mandalore's martial past and sought to overthrow her. Late in the Clone Wars, Darth Maul took over Death Watch and led the conquest of Mandalore. He executed Satine and installed a puppet prime minister as the planet's new ruler, sparking a new chapter in Mandalore's violent history. Satine's sister, Bo-Katan, refused to support Maul and helped his greatest nemesis, Obi-Wan Kenobi, escape capture.
Years later, the Empire occupied the once-proud world. Sabine Wren, a Mandalorian rebel, returned with the Darksaber, looking to unite her people and strike back against Imperial tyranny. With Bo-Katan and several clans, she destroyed the Mandalorian armor-targeting weapon. Sabine then gifted the Darksaber to Bo-Katan, and the clans aligned under her leadership.
Given that The Mandalorian shows some Mandalorian survivors arguing about whether or not it's acceptable to work with (or for) surviving Imperial factions, the scars and divisions of Mandalore's time under the Empire still run deep. It makes sense that the Mandalorians may have been forced underground, both literally and figuratively, in order to survive the wrath of the Empire. As we know, the Empire never looked kindly on rebellion, and Mandalore managed to defy them multiple times. There may be more to the story than that, but for now, the one thing we can probably count on is that this underground dwelling habit originated with Mandalore's clashes with the might of the Empire.