A valid passport book is required to enter Mexico by air, and those attempting to enter at an airport with a U.S. passport card only may be denied admission.
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At a Glance: Yes, you need a passport to go to Cancun, Mexico from the United States. When traveling by air, a valid passport is required, along with a completed Multiple Migratory Form (FMM).
If you're planning on traveling by land or sea, usually a passport card will suffice, though it's recommended to have a book in the event of an emergency flight. For some closed-loop cruises, i.e. originating in and returning to the US on the same trip, a state-issued driver's license can be enough.
Additionally, American citizens can visit Mexico by land without a passport granting them access to other sections of the culturally vibrant country, including Mexico City and San Miguel de Allende. However, remember that you will need a passport card if visiting the country by car.
All foreigners, regardless their nationality, are required to present a valid and not expired passport or travel document when entering Mexico (traveling by air, land or sea). The Mexican government only requires that your passport must be valid during the entirety of your trip.
To clarify, U.S. citizens entering Mexico must present proof of citizenship (such as a certified copy of a birth certificate), photo ID and proof of sufficient funds. A passport and visa are not required of U.S. citizens entering Mexico for tourism or for transit for stays of up to 90 days.
If you try to enter Mexico without a valid travel document (i.e., your passport), authorities may deny you entry into the country. This is true for all forms of travel. Border authorities will likely check that you meet the entry requirements before allowing you to enter Mexico.
All U.S. citizens need U.S. passport books if re-entering by air. Land and sea border crossings accept additional travel documents, such as U.S. Passport cards and Trusted Traveler cards.