1) Defined in the OED as: ‘small trees or shrubs, coppice wood or brush-wood growing beneath higher timber trees’, a term on record from the fourteenth century.
1373-4 boscum lentiscorum corulorum & aliarum minutarum arborum vocatarum vndrewodd, Leeds. After the Dissolution, a survey of the woods formerly held by Selby Abbey contrasts underwood with timber and provides details of the different species and their cycles of growth, first in Southwood: 1543 the underwod wherof standyth moch by hassell and sallowe of sondry ages, wherein are many faire oke spyres of thage of xiiij yeres or thereabowt, And no tymbre within the same wodde and then in Aughton: the underwoode … of the age of xvj or xviij yeres is solde … to be felled within thre yeres next. Other entries name alder, birch and holly, much of which at that time was made in faggottes for the repaire of the stathes and bankes of the water of Owse. The surname Underwood can certainly be geographic in origin and I have found no suggestion that it may sometimes be an occupational by-name. Nevertheless, it is noticeable how often it occurs on wood-managed estates, e.g. 1258 Alice sub bosco, Rothwell
1341 Henry Underwodde, Roundhay Park
1379 Ricardus Undyrwode, Hambleton. Some references are more explicit: 1418-9 In cariagio earumdem arborum a bosco de Hamelton usque Usam apud Selby per Johannem Underwod. I suspect that in Yorkshire it was sometimes occupational and not geographic, and if that is so it has implications for the surname.