Tropical Storm Paula has now developed into a hurricane off the coast of Honduras.
The storm has sustained winds near 75 miles-per-hour, but is expected to strengthen as it approaches Mexico's Yucatan peninsula.
Paula formed Monday off the coast of Honduras and quickly intensified into a hurricane early Tuesday, the National Hurricane Center in Miami said.
The storm was centered about 230 miles south-southeast of Cozumel, Mexico.
Forecasters warned of possible flooding and landslides and suggested residents avoid fishing trips or water sports.
Honduran emergency officials are urging some coastal residents to evacuate.
Mexico issued a hurricane warning as strong winds and rain battered its Caribbean coast Tuesday.
Forecasters said the storm would produce heavy rains that could cause flash floods and mudslides, especially in the mountains of Nicaragua and Honduras. They predicted isolated, mountainous areas in Honduras could get as many as 10 inches of rain.
Coastal flooding from heavy waves was also expected along the eastern coast of the Mexican Yucatan Peninsula and the Bay Islands of Honduras.
Central America is still recovering from recent bouts of devastating rains and mudslides.